At US$302, Is Intuitive Surgical, Inc. (NASDAQ:ISRG) Worth Looking At Closely?

Let's talk about the popular Intuitive Surgical, Inc. (NASDAQ:ISRG). The company's shares saw a double-digit share price rise of over 10% in the past couple of months on the NASDAQGS. As a large-cap stock with high coverage by analysts, you could assume any recent changes in the company’s outlook is already priced into the stock. However, could the stock still be trading at a relatively cheap price? Let’s examine Intuitive Surgical’s valuation and outlook in more detail to determine if there’s still a bargain opportunity.

Check out our latest analysis for Intuitive Surgical

Is Intuitive Surgical still cheap?

Intuitive Surgical appears to be overvalued by 24% at the moment, based on my discounted cash flow valuation. The stock is currently priced at US$302 on the market compared to my intrinsic value of $243.24. This means that the opportunity to buy Intuitive Surgical at a good price has disappeared! But, is there another opportunity to buy low in the future? Since Intuitive Surgical’s share price is quite volatile, this could mean it can sink lower (or rise even further) in the future, giving us another chance to invest. This is based on its high beta, which is a good indicator for how much the stock moves relative to the rest of the market.

What does the future of Intuitive Surgical look like?

Investors looking for growth in their portfolio may want to consider the prospects of a company before buying its shares. Buying a great company with a robust outlook at a cheap price is always a good investment, so let’s also take a look at the company's future expectations. Intuitive Surgical's earnings over the next few years are expected to increase by 30%, indicating a highly optimistic future ahead. This should lead to more robust cash flows, feeding into a higher share value.

What this means for you:

Are you a shareholder? It seems like the market has well and truly priced in ISRG’s positive outlook, with shares trading above its fair value. However, this brings up another question – is now the right time to sell? If you believe ISRG should trade below its current price, selling high and buying it back up again when its price falls towards its real value can be profitable. But before you make this decision, take a look at whether its fundamentals have changed.

Are you a potential investor? If you’ve been keeping tabs on ISRG for some time, now may not be the best time to enter into the stock. The price has surpassed its true value, which means there’s no upside from mispricing. However, the optimistic prospect is encouraging for ISRG, which means it’s worth diving deeper into other factors in order to take advantage of the next price drop.

It can be quite valuable to consider what analysts expect for Intuitive Surgical from their most recent forecasts. So feel free to check out our free graph representing analyst forecasts.

If you are no longer interested in Intuitive Surgical, you can use our free platform to see our list of over 50 other stocks with a high growth potential.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.