Barrington Maintains Market Perform on Intuitive Surgical After Strong 4Q

Barrington Research has published a report on Intuitive Surgical

after the company reported strong 4Q revenues. In the report, Barrington writes, "Instrument and accessory revenue was $196 million, up 30% versus $151 million in Q4/10, due to a 27% increase in da Vinci procedures and initial purchases of recently launched products such as its Firefly and Thoracic instrument set. da Vinci Hysterectomy procedures grew roughly 33% to 146,000 procedures versus 110,000 in 2010 driven from gynecologic procedures in the U.S. and dVP procedures in Europe. There were a total of 359,000 procedures in 2011, up from 278,000 procedures in 2010 and management expects procedures to grow between 24-26% in 2012. There are more than 500,000 hysterectomies in the U.S. alone creating significantly more opportunity for future growth. In addition, we expect continued growth from non-dVH and dVP procedures which grew more than 40% in 2011. Service revenue increased 24% to $75.4 million versus $60.6 million in Q4/10, due to da Vinci's growing installed base. Systems revenue increased roughly 27% to $225.0 million versus $177.6 million in Q4/10 and increased approximately 13% versus $199.1 million in Q3/11 due to higher system unit sales and increased system selling prices. The company-wide ASP for da Vinci surgical systems was $1.47 million in Q4/11 compared with $1.41 million in Q4/10 and $1.46 million in Q3/11. The increase in ASP reflects the higher proportion of units sold with dual consoles, surgical simulators and Firefly." Barrington Research maintains its Market Perform rating on Intuitive Surgical, which is currently trading down $31.20 from yesterday's $474.65 closing price.