Intuitive Surgical (ISRG) Could Be 24% Above Fair Value As Earnings Split The Market

Intuitive Surgical (ISRG) drew fresh attention after third quarter earnings on 20 October 2026, as higher revenue contrasted with lower quarterly profit and earnings per share, while nine month results painted a different picture.

Recent trading suggests sentiment around Intuitive Surgical is rebuilding. The 90 day share price return of 24.83% and 30 day gain of 11.46% follow a year to date decline of 19.64%. The 3 year total shareholder return of 74.72% contrasts with a 1 year total shareholder return decline of 18.07%.

Spot 34 healthcare AI stocks that, like Intuitive Surgical after this earnings jolt, combine medical technology with AI driven tools that are shaping how procedures and diagnostics are delivered.

Bulls see Intuitive Surgical’s earnings wobble as noise, while bears see a maturing franchise priced for perfection. Which view survives a closer look at what the current valuation already bakes in?

Most Popular Narrative: 38% Overvalued

Compared with the last close at $451.63, the leading narrative pegs Intuitive Surgical’s long term fair value nearer $342.74. This frames the recent rebound as pricing in a lot of optimism already.

The model assumes future revenue growth of 14.7% annually, a long-term net profit margin of 25% compared with the current 28.45%, and a 35× exit P/E compared with the current 46.76×. These assumptions produce a five-year fair-value estimate of USD 342.74.

See why 2 investors see Intuitive Surgical as 38% overvalued.

Result: Fair Value of $342.74 (OVERVALUED)

Still, if GLP-1 drugs curb bariatric surgery volumes or if hospital capital budgets tighten further, the overvaluation case on Intuitive Surgical could unravel faster than expected.

Find out about the key risks to this Intuitive Surgical narrative.

Another View: Our DCF Model Sees Intuitive Surgical Differently

The community narrative flags Intuitive Surgical as heavily overvalued around $451.63, yet our DCF model tells a softer story. On these cash flow assumptions, the stock sits about 3.6% below an estimated fair value of $468.54, which frames the current price as closer to fair than frothy. Does that small gap feel like a margin of safety or just thin ice to you?

Look into how the SWS DCF model arrives at its fair value.

Simply Wall St performs a discounted cash flow (DCF) on every stock in the world every day (check out Intuitive Surgical for example). We show the entire calculation in full. You can track the result in your watchlist or portfolio and be alerted when this changes, or use our stock screener to discover 29 high quality undervalued stocks. If you save a screener we even alert you when new companies match - so you never miss a potential opportunity.

Next Steps

Curious whether this mix of optimism and caution around Intuitive Surgical really holds up for you? Move quickly, stress test the assumptions, and see how those potential upsides stack up in the 3 key rewards.

Looking for more Intuitive Surgical style investment ideas?

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• Target stronger value by scanning companies that combine quality fundamentals with a discount to intrinsic worth through the 29 high quality undervalued stocks.
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