Intuitive Surgical (NASDAQ:ISRG) Shareholders Have Enjoyed A Whopping 313% Share Price Gain

For many, the main point of investing in the stock market is to achieve spectacular returns. And highest quality companies can see their share prices grow by huge amounts. Just think about the savvy investors who held Intuitive Surgical, Inc. (NASDAQ:ISRG) shares for the last five years, while they gained 313%. And this is just one example of the epic gains achieved by some long term investors. It's down 4.9% in the last seven days.

Check out our latest analysis for Intuitive Surgical

In his essay The Superinvestors of Graham-and-Doddsville Warren Buffett described how share prices do not always rationally reflect the value of a business. One way to examine how market sentiment has changed over time is to look at the interaction between a company's share price and its earnings per share (EPS).

During five years of share price growth, Intuitive Surgical achieved compound earnings per share (EPS) growth of 13% per year. This EPS growth is lower than the 33% average annual increase in the share price. So it's fair to assume the market has a higher opinion of the business than it did five years ago. And that's hardly shocking given the track record of growth. This optimism is visible in its fairly high P/E ratio of 86.13.

The company's earnings per share (over time) is depicted in the image below (click to see the exact numbers).

Dive deeper into Intuitive Surgical's key metrics by checking this interactive graph of Intuitive Surgical's earnings, revenue and cash flow.

A Different Perspective

It's good to see that Intuitive Surgical has rewarded shareholders with a total shareholder return of 30% in the last twelve months. However, the TSR over five years, coming in at 33% per year, is even more impressive. Before spending more time on Intuitive Surgical it might be wise to click here to see if insiders have been buying or selling shares.

If you like to buy stocks alongside management, then you might just love this free list of companies. (Hint: insiders have been buying them).

Please note, the market returns quoted in this article reflect the market weighted average returns of stocks that currently trade on US exchanges.

If you decide to trade Intuitive Surgical, use the lowest-cost* platform that is rated #1 Overall by Barron’s, Interactive Brokers. Trade stocks, options, futures, forex, bonds and funds on 135 markets, all from a single integrated account. Promoted

This article by Simply Wall St is general in nature. 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.
^*Interactive Brokers Rated Lowest Cost Broker by StockBrokers.com Annual Online Review 2020

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.