Morgan Stanley analyst Patrick Wood maintained a Buy rating on Intuitive Surgical yesterday and set a price target of $650.00.
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Patrick Wood has given his Buy rating due to a combination of factors related to Intuitive Surgical’s potential in the endoluminal robotics market. The recent success of EndoQuest’s PARADIGM trial, which demonstrated the feasibility of performing complex colorectal lesions using endoscopic submucosal dissection (ESD), highlights a significant opportunity for Intuitive Surgical. This procedure, although technically challenging, offers stronger clinical outcomes compared to more common methods in the US, and its success could lead to a broader adoption of robotic-assisted surgeries.
Wood notes that while there are challenges such as reimbursement rates for ESD, the technical advancements and potential market expansion are promising. The potential for 35% ESD penetration in gastrointestinal procedures could translate to approximately 363,000 new procedures globally, representing a substantial revenue opportunity. Additionally, the advancements in overcoming technical issues suggest that a wider range of endoluminal surgeries could become viable for robotic systems, positioning Intuitive Surgical to capitalize on this growing market.
In another report released yesterday, Bank of America Securities also maintained a Buy rating on the stock with a $650.00 price target.