Random Walk

Hospitals' CapEx Cautions May Be Limiting Intuitive Surgical Growth, For Now

60% of hospitals are not-for-profit. The credit crunch and problems in the auction rate securities markets do have an impact on these hospitals. On the margin, such hospitals would target big ticket items like capital equipment. Last I remember Intuitive Surgical revenues are comprised of such big ticket items. Given the multiple on the stock, should the recession persist longer than six months, why should you expect med cap equipment companies to trade at an even higher multiple than other companies during a bear market, given the financing issues of hospitals?