Canaccord Genuity Ups Intuitive Surgical (ISRG) PT to $590 on Solid Q4
Canaccord Genuity raised its price target on Intuitive Surgical (NASDAQ: ISRG) from $535 to $590 following Q4 results, but maintained a Hold rating.
The firm comments, "ISRG ended 2012 on a high note, reporting Q4 results that handily topped our estimates and consensus expectations. Procedure growth of 25% in Q4 also exceeded our projection. That said, 2013 guidance (procedure growth: 20-23%; revenue growth: 16-19%) was a bit conservative relative to our original projections (25% and 18%, respectively). Despite a clean quarter, we do not think these results warrant the 10% after-hours upside in the stock, and worry that softness in U.S. dVP – coupled with macro challenges in Europe – could limit upside to guidance/estimates in 2013. Finally, while we think ISRG still has some headroom in the hysterectomy market, US penetration is approaching levels (>50%) at which growth is likely to moderate."
"We continue to recommend investors equal weight ISRG in large-cap growth portfolios. We increase our price target primarily because we are rolling forward our valuation analysis to 2014 estimates. Our $590 target represents a PEG of 1.5x (same as before), which is in line with the large-cap comp group, based on a forward two-year EPS CAGR."
For an analyst ratings summary and ratings history on Intuitive Surgical click here. For more ratings news on Intuitive Surgical click here.
Shares of Intuitive Surgical closed at $518.49 yesterday, with a 52 week range of $436.64-$594.89.
The firm comments, "ISRG ended 2012 on a high note, reporting Q4 results that handily topped our estimates and consensus expectations. Procedure growth of 25% in Q4 also exceeded our projection. That said, 2013 guidance (procedure growth: 20-23%; revenue growth: 16-19%) was a bit conservative relative to our original projections (25% and 18%, respectively). Despite a clean quarter, we do not think these results warrant the 10% after-hours upside in the stock, and worry that softness in U.S. dVP – coupled with macro challenges in Europe – could limit upside to guidance/estimates in 2013. Finally, while we think ISRG still has some headroom in the hysterectomy market, US penetration is approaching levels (>50%) at which growth is likely to moderate."
"We continue to recommend investors equal weight ISRG in large-cap growth portfolios. We increase our price target primarily because we are rolling forward our valuation analysis to 2014 estimates. Our $590 target represents a PEG of 1.5x (same as before), which is in line with the large-cap comp group, based on a forward two-year EPS CAGR."
For an analyst ratings summary and ratings history on Intuitive Surgical click here. For more ratings news on Intuitive Surgical click here.
Shares of Intuitive Surgical closed at $518.49 yesterday, with a 52 week range of $436.64-$594.89.