Intuitive Surgical Delivers Blowout Quarter

NEW YORK ( TheStreet) -- Intuitive Surgical ( ISRG) beat Wall Street profit expectations for a seventh straight quarter Thursday, topping the average analyst view by more than 30%.

The Sunnyvale, Calif.-based maker of robotic surgery equipment reported a profit of $121 million, or $3.02 a share, for the three months ended Dec. 31, up from year-ago equivalent earnings of $78 million, or $1.95 a share, and 34.4% ahead of the average estimate of analysts polled by Thomson Reuters for earnings of $2.25 a share.

Revenue rose 21% year-over-year to $389.3 million in the December period, beating a consensus estimate of $370 million. The company cited "continued robotic procedure adoption and higher da Vinci Surgical System sales" for the revenue growth.

Intuitive Surgical said it saw a 35% increase in procedures performed with its da Vinci system, sparking growth of 33% in its instruments and accessories revenue to $151 million in the latest quarter from $113 million last year. Systems revenue increased 10% to $178 million in the quarter, while service revenue swelled 27% to $61 million.

The stock was last quoted at $323.69, up 11.7%, on volume of more than 250,000 in after-hours action, according to Nasdaq.com. The shares hit a rough patch in 2010. They are down about 6% in the past 52 weeks but based on Thursday's regular session close at $289.83 were off more than 26% since hitting a 52-week high of $393.92 on April 15.

2011 has been pretty good so far though with the stock up 11% before the after-hours ramp-up. A move above $300 would bring it back to levels unseen in the past three months or so and represent strong break above both its 50-day and 200-day moving averages of $268.02 and $286.09, respectively.

Wall Street had cooled off on the stock ahead of the report with 11 of the 19 analysts covering the shares rating them at either hold (10) or sell (1); although the 12-month median price target was $300.

The 30%-plus beat by Intuitive Surgical in this latest quarter was the largest margin of outperformance for the company during the seven-quarter streak that's seen it exceed the consensus profit view by an average of 17.8%. In its fiscal third quarter ended in September, Intuitive Surgical's profit came in less than 2% ahead of Wall Street's view, prompting a selloff of more than 7% in the stock in the next trading session.

-- Written by Michael Baron in New York.

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