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This one is high up on my watchlist.  The fundamentals of ISRG are outstanding.

Its attributes include accelerating earnings, sales, and even earnings surprises the last couple of quarters, upward analyst revisions for the next quarter, solid annual earnings estimates for 2010 and 2011, high and increasing margins, solid ROE, excellent cash flow and no debt.

The Medical sector is only behind Retail as a leading sector.  ISRG is the top-rated stock in the Medical-Systems/Equipment industry sub-group. 

There seems to be strong support at the 200-day line.

ISRG's action from the bear market low (March 2009) has been very impressive.  I would interpret the stock's current base as a first stage one.   Other interpretations are welcome.  There was talk last fall about an ascending base, but I can't see it.

The stock hit new highs on low volume for weeks last November and December, yet kept plowing along until the current correction finally took it down.

Notice the 5 "skyscrapers" on the weekly chart since the bottom, i.e., huge-volume weeks which tower above the surrounding weeks.  This is clear institutional buying.  Also, in the 15 months since the bottom ISRG shows only 2 distribution weeks - very impressive.

In looking for a leading and potentially winning stock one question you should ask yourself is "do institutions have to own it".  In the case of ISRG the answer is clearly yes.  The company has a NEW product with almost no competition.  The stock has been a leader since the bear market bottom, and looks likely to continue its leadership role once this correction has run its course.

Disclosure: No long/short positions at this time.