Is Intuitive Surgical Inc (ISRG) overvalued?
On Equity Rank's model estimate, ISRG trades 44% above its fair value. Intuitive Surgical Inc (ISRG) last closed at $452.80; the multi-method model fair value is $313.70.
| Price | Model fair value | Price vs model |
|---|---|---|
| $452.80 | $313.70 | 44% above |
What the answer rests on
- 0 of 8 valuation methods put ISRG's value above its price and 8 put it below, so the methods mostly agree.
- To justify today's price, ISRG's free cash flow would need to grow about 26.9% a year for ten years (a reverse discounted cash flow). Over the last three years it actually grew 37.5% a year.
- ISRG trades at 58.3 times its last year's earnings, against a median of 30.9 for 37 profitable Medical Devices companies.
- Over the past year the price sat below the model fair value on 0% of trading days. The gap ranged from 23% above to 122% above the model fair value.
Read this before relying on it
The model fair value is an estimate from published financial statements. It is not a forecast of where the price goes, and it can be wrong. Within 10% either side we call it close to fair value: valuation models are not precise enough to read more into a smaller gap. Our own lists have no proven edge over the market yet; the live record shows every result, misses included.
Every valuation method behind ISRG's fair value · What prices assume · Other companies