Monday December 10, 2007
“Intiutive Surgical (NASDAQ: ISRG) has broken above resistance at the 340 level,” notes Leo Fasciocco in The Ticker Tape Digest, a service that specializes on breakout stocks.
“The company makes medical devices for surgery. ISRG's star product is called the da Vinci Surgical System. It uses what scientist call haptics (the science of computer-aided touch sensitivity).
“The system uses software, hardware, and optics to allow doctors to perform robotically aided surgery from a remote console. The company also makes EndoWrist surgical instruments for use with its system.
“The da Vinci system reproduces the doctor's hand movements in real time, with surgery performed by tiny electromechanical arms and instruments inserted in the patient's body through small openings.
“The stock, one of the highest priced stocks traded on the Nasdaq, has risen sharply on expanding volume to breakout from a seven-week, cup-and-handle base today. The move carried the stock to a new all-time high.
“Looking at a long-term chart, ISRG as being probably the biggest winner in the stock market for the past four years soaring from 15 to 343. The stock remains in a solid bullish pattern long-term and it technical support for the breakout is excellent.
“Our momentum indicator is strongly bullish and the accumulation - distribution line is in an overall up trend long-term and is now turning up.
“Meanwhile, the company should continue to show powerful earnings growth. Net for the upcoming fourth quarter should jump 67% to $1.04 a share from 62 cents a year ago. The highest estimate on the Street is at $1.07 a share.
“For the year, ISRG's profits should soar 85% to $3.49 a share from $1.89 a year ago. The stock sells with a price-earnings ratio of 98, which is very high. Next year, analysts project a 34% improvement in profits to $4.69 a share.
“ISRG is appropriate for aggressive investors - not because of its high price, but high valuation. Nevertheless, the stock is acting strong and profits are growing. We are targeting ISRG for a move to 410 within the next few months. A protective stop can be placed near 320.”
