Intuitive Surgical

2014 change: 36%

Market cap: $19 billion

Major holders at Sept. 30: T. Rowe Price (15.56%), Baillie Gifford (6.73%), Morgan Stanley (5.99%), Vanguard Group (5.17%), Brown Advisory (4.17%), State Street (4.14%), Bank of New York Mellon (4.01%) and BlackRock (2.58%)

Why is it up? Investors weren't convinced that Intuitive Surgical ($ISRG) could make good on the launch of its latest minimally invasive surgical system, the da Vinci Xi Surgical System. A massive selloff followed a spike on news of its April 1 launch, possibly heightened by safety concerns and recalls that have nagged the company. But Intuitive has almost reached those highs from earlier in the year again by achieving solid revenue growth with the new system. During the third quarter, Intuitive revenues were up 14% year over year to $273 million. The company chalked the growth up to gains in U.S. general surgery, the specialty of the da Vinci Xi. Intuitive has helped define and is cashing in on the increasing demand for minimally invasive surgery. Its da Vinci system includes a robotic hand that is manipulated by the surgeon but can operate much more precisely than a human hand and work with a smaller incision. "Looking more closely at the United States, growth in general surgery led the way with procedure--with the procedure category, our second largest behind gynecology. General surgery procedure growth was broad-based, including colon resection, rectal resection and hernia repair," Intuitive President and CEO Gary Guthart said during the third-quarter conference call.

What comes next? Intuitive Surgical still has a long way up, according to analyst Richard Newitter of Leerink. In early January, he raised his per-share price target for the company from $570 to about $590, particularly impressive given that its shares are only at around $520 now. He expects Intuitive's robotic surgical tools to extend into a number of new general surgery procedures, such as cholecystectomy, colorectal, bariatric, and thoracic as well as head and neck. Newitter also expects to see more international adoption of Intuitive's surgical robots. "Early physician feedback--particularly from colorectal and general surgeons--suggests the new platform has potential to further ISRG's efforts in penetrating gen surgery areas (ISRG's next leg of growth)," he concluded.

ISRG Chart

ISRG data by YCharts

For more:
Intuitive Surgical kicks off da Vinci sales in Japan
Intuitive gets out from under FDA warning letter
Investors endorse Intuitive's rollout of a next-gen surgical robot
Intuitive's sales slide 5% in Q4 and its fate remains uncertain
Robot arm friction problem forces Intuitive Surgical recall

-- Stacy Lawrence (email | Twitter)

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