Will Intuitive Surgical Stock Rebound After Its Recent Fall?

ISRG: Intuitive Surgical logo
Intuitive Surgical

The stock price of Intuitive Surgical (NASDAQ: ISRG), a fast growing robotic surgical devices company, has seen a 7% fall in a month, while it was down nearly 6% just last week. This can largely be attributed to a broader sell-off in the markets with the S&P500 falling over 2% following the reports of a new variant of the Covid-19 – Omicron – which has 32 mutations in the spike protein – the part of the virus that Covid-19 vaccines target. WHO declared Omicron to be a variant of concern. Overall, the markets were looking forward to the ramp up in demand and opening up of economies, but now, there are looming concerns of more restrictions. In fact, many countries in Europe are now looking at increased restrictions, and Austria is going with a partial lockdown since last week, and moving forward with a vaccine mandate.

Looking at Intuitive Surgical, a rise in the number of Covid-19 cases means more pressure on healthcare institutions, especially in certain geographies with limited resources. This will likely impact the total procedure volume, a trend seen in the recent past as well, with the spread of the Delta variant.

But now that ISRG stock has fallen 7% in a month, will it continue its downward trajectory, or is a rise imminent? Going by historical performance, there is a higher chance of a rise in ISRG stock over the next month. Out of 248 instances in the last ten years that ISRG stock saw a twenty-one day fall of 7% or more, 161 of them resulted in ISRG stock rising over the subsequent one-month period (twenty-one trading days). This historical pattern reflects 161 out of 248, or about a 65% chance of a rise in ISRG stock over the coming month. See our analysis on Intuitive Surgical Stock Chances of Rise for more details.

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So, if this follows the historical pattern, ISRG stock is likely to see higher levels. That said, the move in ISRG stock will also depend on the trend in U.S. Covid-19 cases. If the Omicron results in another large spike in total number of Covid-19 cases, it is likely that ISRG stock will actually see even lower levels, along with some of the other medical devices companies, as well. Wondering how Intuitive Surgical’s peers stack up? Check out Intuitive Surgical Stock Comparison With Peers to see how ISRG stock compares against peers on metrics that matter. You can find more such useful comparisons on Peer Comparisons.

Calculation of ‘Event Probability‘ and ‘Chance of Rise‘ using last ten years data

  • After moving -5.6% or more over a five-day period, the stock rose in the next five days on 55% of the occasions.
  • After moving -7.2% or more over a ten-day period, the stock rose in the next ten days on 56% of the occasions
  • After moving -7.4% or more over a twenty-one-day period, the stock rose in the next twenty-one days on 65% of the occasions.

Intuitive Surgical (ISRG) Stock Return (Recent) Comparison With Peers

  • Five-Day Return: BDX highest at -1.4%; EW lowest at -6.4%
  • Ten-Day Return: BDX highest at 0.4%; BSX lowest at -8.3%
  • Twenty-One Days Return: BDX highest at 2.7%; BSX lowest at -10.7%

While ISRG stock may see higher levels, 2020 has created many pricing discontinuities which can offer attractive trading opportunities. For example, you’ll be surprised how counter-intuitive the stock valuation is for United Therapeutics vs Quest Diagnostics.

What if you’re looking for a more balanced portfolio instead? Here’s a high-quality portfolio that’s beaten the market consistently since the end of 2016.

Returns Nov 2021
MTD [1]
YTD [1]
Total [2]
ISRG Return -6% 21% 367%
S&P 500 Return 1% 22% 105%
Trefis MS Portfolio Return -3% 46% 297%

[1] Month-to-date and year-to-date as of 11/29/2021
[2] Cumulative total returns since 2017

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