BigJimmyD

Intuitive Surgical: The Wonder Stock

Correct, that after the 1/31/08 earnings the stock price rose $51.61 (20.32%). But that was preceeded by an analyst comment (copy below) (of questionable motivation) that caused the price to drop by $33.27, or 12 percent. So the net gain from earnings was $18.34 or 8%. So this article is misleading.

Intuitive Surgical Shares Fall 7 Percent
Tuesday January 29, 7:12 pm ET
Oppenheimer Analyst Says Growth to Slow for Intuitive Surgical in 2008, Shares Fall

NEW YORK (AP) -- Shares of medical device maker Intuitive Surgical Inc. fell sharply Tuesday as an Oppenheimer & Co. analyst said the company's strong growth will slow in 2008 on fewer U.S. sales of the da Vinci surgical system, due to market saturation and a lack of adoption by gynecologists for hysterectomy procedures.
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Analyst Amit Hazan said Intuitive Surgical is the most expensive stock in the medical technology sector, a value driven by both the company's robust growth rates and by results consistently beating Wall Street expectations by wide margins. Intuitive's da Vinci system allows doctors to perform robot-aided surgery through small openings in the patient's body from a remote console.

But although he expects fourth-quarter results will once again exceed estimates, he thinks 2008 sales guidance will fall slightly below the $817 million consensus estimate. He cited slowing U.S. system placement growth and lack of upside from hysterectomy procedures due to gynecologists' unexplainable trepidation about adopting newer, less invasive technology and little to no patient awareness about the system's availablity.

"In short, as growth comes back to earth, the premium paid will likely be reduced, and we see fair value at below current levels," Hazan wrote in a note to clients. He emphasized caution on the stock in 2008.

Shares fell $33.27, or 12 percent, to $244.30 Tuesday.

Cowen and Co. analyst Eli Kammerman also expects Intuitive Surgical's fourth-quarter results to top Wall Street expectations when the company reports financials on Thursday, and predicts management will issue conservative sales guidance for 2008. But he thinks better-than-expected procedure volumes are probable in gynecology in 2008 and in a note to clients late Wednesday reiterated an "Outperform" rating on the stock.

Kammerman predicts Intuitive Surgical shares will outperform the market by 20 percent this year.