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Tech Stocks to Buy: Intuitive Surgical, Inc. (ISRG)Tech Stocks to Buy: Intuitive Surgical, Inc. (ISRG)The roots of Intuitive Surgical, Inc. (NASDAQ:ISRG) go back the late 1980s, with the research into robotic surgery from the SRI International Institute.
Then in the mid-1990s, Dr. Frederic Moll understood that the commercial potential was enormous — yet he had trouble getting much buy-in.
But like any great entrepreneur, he did not give up. Eventually he was able to raise the necessary capital to buy the technology from SRI.
Of course, he turned out to be spot-on. As of now, ISRG has a market cap of $34 billion.
At the heart of the company is the da Vinci Surgical System, which allows doctors to perform surgeries, such as for prostatectomies and gynecologic procedures, by using a remote console. Essentially, the system mimics hand movements.
A typical device costs about $1.5 million. But there are also recurring fees for maintenance as well as wrists joints and staplers.
Overall, the business model has been quite lucrative. During the latest quarter, revenues rose by 13% to $595 million and earnings came to $180 million, up from $136 million compared to the same period a year ago.
This also does not include $23 million from deferred revenues. The company has a total of $3.1 billion in the bank.
Interestingly enough, ISRG has been quite investor friendly as well. During the quarter, the share buybacks came to a hefty $2 billion.
But going forward, the growth rate is likely to perk up. A key reason is that ISRG is planning on introducing lower cost systems, which should help to expand the market opportunity. It’s important to keep in mind that — according to research from RBC Capital Markets — robots still constitute only about 5% to 10% of the total market.
Source: Investor Place
http://investorplace.com/2017/06/4-tech ... UON42h96M8
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