Intuitive Surgical Vaults Into $100 Billion Club on Earnings

(Bloomberg) -- Intuitive Surgical Inc. joined a handful of U.S. health-care companies to reach $100 billion in market value Wednesday, fueled by strong first-quarter earnings and an optimistic outlook for recovery after Covid-19.

The company, whose da Vinci robotic system is designed to facilitate minimally invasive procedures, rallied 9.9% to a record $891.38, its best day since March 2020. It joins the likes of Medtronic Plc. and Bristol-Myers Squibb Co. among health firms to eclipse the $100 billion mark. CVS Health Corp. ended Wednesday’s trading just above the threshold too.

Intuitive has soared nearly 80% in the past year as investors piled back into companies seen as likely to weather the storm of Covid-19, giving it a market value of about $106 billion. Strong results from the company alongside medical devices heavyweights Abbott Laboratories and Edwards Lifesciences Corp. have signaled to investors that elective surgeries are returning more rapidly than expected as the U.S. economy reopens.

The company’s stronger than expected first-quarter robotic systems installations provided more evidence that hospital expenditures remain “quite robust,” signaling that medical centers are prepared for impending volume recovery, Deutsche Bank analyst Imron Zafar wrote in a note to clients.

The demand “will be buoyed by a multi-quarter tailwind from the sizeable backlog of deferred surgeries and delayed diagnoses/referrals across key segments like prostatectomy and colorectal,” Zafar continued.

Most analysts covering the company are also optimistic. More than half have a buy recommendation on the stock, eight research firms have a neutral stance and only two have a sell rating, according to data compiled by Bloomberg.

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