UPDATE: Bank of America Merrill Lynch Upgrades Intuitive Surgical to Buy, Raises PO

In a report published Friday, Bank of America Merrill Lynch upgraded its rating on Intuitive Surgical ISRG from Neutral to Buy, and raised its price objective from $565.00 to $620.00. BofA Merrill Lynch noted, “We are upgrading Intuitive Surgical (ISRG) to Buy and raising our PO to $620 based on our high conviction that ISRG's da vinci robot will play a significant role in the U.S. general surgery market over time. While many have been skeptical around ISRG's ability to see meaningful uptake in general surgery given the robot's high cost and perceived lack of clinical benefit in these procedures, our due diligence suggests that ISRG's pipeline technologies – many of which are likely to be launched in the next 12 months – should allow the robot to provide much more clinical value in general surgery over time. This pipeline visibility, combined with our ongoing conversations with surgeons, has left us convinced ISRG will take meaningful share of the GS market over the next 3-5 yrs. We believe ISRG's ability to penetrate this market should allow for 2013-14 top-line and EPS growth of at least 15-20% and should increase their long-term recurring revenue opportunity to $10bn+.” Intuitive Surgical closed on Thursday at $535.82.
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Posted In: Analyst ColorUpgradesAnalyst RatingsBank of America Merrill Lynch
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