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What's in Store for Intuitive Surgical's (ISRG) Q3 Earnings?
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Intuitive Surgical, Inc. (ISRG - Free Report) is scheduled to release third-quarter 2020 results on Oct 15, after the closing bell.
In the last reported quarter, the Zacks Rank #3 (Hold) company delivered an earnings surprise of 226.5%. Its earnings beat estimates in each of the trailing four quarters, the average surprise being 63.8%.
Q3 Estimates
Currently, the Zacks Consensus Estimate for third-quarter revenues is pegged at $962.8 million, suggesting a decline of 14.7% from the year-ago reported figure. The consensus mark for earnings stands at $1.95 per share, indicating a slump of 43.2% from the prior-year quarter.
Factors to Note
The Instruments & Accessories segment is likely to have witnessed a weak third-quarter. In fact, the Zacks Consensus Estimate for this segment’s third-quarter earnings stands at $538 million, suggesting a decline of 11.2% from the year-ago quarter. The segment’s revenues bore the brunt of the COVID-19 induced disruption in the first half of the year, which is likely to have continued in third-quarter 2020. Although elective surgeries and non-critical procedures have been slowly picking up pace, the resurgence in cases in several regions of the United States is likely to have put a pause on the same. This might have weighed on da Vinci procedure volume in the to-be-reported quarter.
The system placement disruption resulting from the impact of the pandemic hurt the company’s procedure volume. Consequently, its first-half results reflected the impact of such disruptions, and the trend is likely to have continued in the third quarter.
Further, the flagship, da Vinci surgical system, which has been driving revenues consistently for the segment, might have been impacted by the aforementioned procedural delays and system placement disruption. This, in turn, is likely to get reflected in the to-be-reported quarter’s results.
Similarly, Intuitive Surgical is likely to have witnessed a decline in revenues with respect to its Systems segment in the to-be-reported quarter.
For the quarter to be reported, the Zacks Consensus Estimate for Systems is pegged at $238 million, indicating a slump of 29.8% from the year-ago quarter.
Nonetheless, Intuitive Surgical is likely to have witnessed improvement with respect to international revenues in the to-be-reported quarter courtesy of robust procedure growth in Asia.
During second-quarter 2020, the company unveiled its Extended Use Program that represents some of its higher volume instruments, which exclude stapling, monopolar and advanced energy instruments that can be utilized across numerous da Vinci surgeries. Under this program, the company intends to launch select Xi/X instruments having 12 to 18 uses in comparison to the current 10 use instruments.
In fourth-quarter 2019, Intuitive Surgical announced that it is in the Phase I launch of the da Vinci SP, having installed six systems in the same time period. Moreover, the company initiated the launch of SynchroSeal sealing and transection device for use in general surgery in fourth-quarter 2019. Management expects a full launch in 2020. Notably, the company continues to introduce technologies for surgical systems and strengthening product portfolio.
The aforementioned developments are likely to have contributed to Intuitive Surgical’s third-quarter performance.
What Our Quantitative Model Suggests
Per our proven model, the combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the chances of an earnings beat. This is the case here as you will see.
Earnings ESP: Intuitive Surgical has an Earnings ESP of +3.71%. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Zacks Rank: It carries a Zacks Rank #3.
Other Stocks Worth a Look
Here are some other medical stocks worth considering as these too have the right combination of elements to post an earnings beat this quarter.
Masimo Corporation (MASI - Free Report) has an Earnings ESP of +10.71% and a Zacks Rank of 2.
Thermo Fisher Scientific Inc. (TMO - Free Report) has an Earnings ESP of +1.31% and a Zacks Rank of 1.
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Zacks has just released a Special Report on the booming investment opportunities of legal marijuana.
Ignited by referendums and legislation, this industry is expected to blast from an already robust $17.7 billion in 2019 to a staggering $73.6 billion by 2027. Early investors stand to make a killing, but you have to be ready to act and know just where to look.
Image: Bigstock
What's in Store for Intuitive Surgical's (ISRG) Q3 Earnings?
Intuitive Surgical, Inc. (ISRG - Free Report) is scheduled to release third-quarter 2020 results on Oct 15, after the closing bell.
In the last reported quarter, the Zacks Rank #3 (Hold) company delivered an earnings surprise of 226.5%. Its earnings beat estimates in each of the trailing four quarters, the average surprise being 63.8%.
Q3 Estimates
Currently, the Zacks Consensus Estimate for third-quarter revenues is pegged at $962.8 million, suggesting a decline of 14.7% from the year-ago reported figure. The consensus mark for earnings stands at $1.95 per share, indicating a slump of 43.2% from the prior-year quarter.
Factors to Note
The Instruments & Accessories segment is likely to have witnessed a weak third-quarter. In fact, the Zacks Consensus Estimate for this segment’s third-quarter earnings stands at $538 million, suggesting a decline of 11.2% from the year-ago quarter. The segment’s revenues bore the brunt of the COVID-19 induced disruption in the first half of the year, which is likely to have continued in third-quarter 2020. Although elective surgeries and non-critical procedures have been slowly picking up pace, the resurgence in cases in several regions of the United States is likely to have put a pause on the same. This might have weighed on da Vinci procedure volume in the to-be-reported quarter.
The system placement disruption resulting from the impact of the pandemic hurt the company’s procedure volume. Consequently, its first-half results reflected the impact of such disruptions, and the trend is likely to have continued in the third quarter.
Intuitive Surgical, Inc. Price and EPS Surprise
Intuitive Surgical, Inc. price-eps-surprise | Intuitive Surgical, Inc. Quote
Further, the flagship, da Vinci surgical system, which has been driving revenues consistently for the segment, might have been impacted by the aforementioned procedural delays and system placement disruption. This, in turn, is likely to get reflected in the to-be-reported quarter’s results.
Similarly, Intuitive Surgical is likely to have witnessed a decline in revenues with respect to its Systems segment in the to-be-reported quarter.
For the quarter to be reported, the Zacks Consensus Estimate for Systems is pegged at $238 million, indicating a slump of 29.8% from the year-ago quarter.
Nonetheless, Intuitive Surgical is likely to have witnessed improvement with respect to international revenues in the to-be-reported quarter courtesy of robust procedure growth in Asia.
During second-quarter 2020, the company unveiled its Extended Use Program that represents some of its higher volume instruments, which exclude stapling, monopolar and advanced energy instruments that can be utilized across numerous da Vinci surgeries. Under this program, the company intends to launch select Xi/X instruments having 12 to 18 uses in comparison to the current 10 use instruments.
In fourth-quarter 2019, Intuitive Surgical announced that it is in the Phase I launch of the da Vinci SP, having installed six systems in the same time period. Moreover, the company initiated the launch of SynchroSeal sealing and transection device for use in general surgery in fourth-quarter 2019. Management expects a full launch in 2020. Notably, the company continues to introduce technologies for surgical systems and strengthening product portfolio.
The aforementioned developments are likely to have contributed to Intuitive Surgical’s third-quarter performance.
What Our Quantitative Model Suggests
Per our proven model, the combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the chances of an earnings beat. This is the case here as you will see.
Earnings ESP: Intuitive Surgical has an Earnings ESP of +3.71%. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Zacks Rank: It carries a Zacks Rank #3.
Other Stocks Worth a Look
Here are some other medical stocks worth considering as these too have the right combination of elements to post an earnings beat this quarter.
Stryker Corporation (SYK - Free Report) has an Earnings ESP of +2.24% and a Zacks Rank of 3. You can see the complete list of today’s Zacks #1 Rank stocks here.
Masimo Corporation (MASI - Free Report) has an Earnings ESP of +10.71% and a Zacks Rank of 2.
Thermo Fisher Scientific Inc. (TMO - Free Report) has an Earnings ESP of +1.31% and a Zacks Rank of 1.
Looking for Stocks with Skyrocketing Upside?
Zacks has just released a Special Report on the booming investment opportunities of legal marijuana.
Ignited by referendums and legislation, this industry is expected to blast from an already robust $17.7 billion in 2019 to a staggering $73.6 billion by 2027. Early investors stand to make a killing, but you have to be ready to act and know just where to look.
See the pot stocks we're targeting >>