1. Intuitive Surgical, Inc. (NASDAQ:ISRG)
Number of Hedge Fund Holders: 67
Market Capitalization: $172.6 billion
Intuitive Surgical, Inc. (NASDAQ:ISRG) is a healthcare equipment company based in Sunnyvale, California. The company is a leader in healthcare robotics and is best known for its Da Vinci surgical system. This system enables minimally invasive surgery with precision through robotic-enhanced vision and control for surgeons.
The company has huge amounts of patient data through which it trains its AI models. In 2023 alone, Intuitive Surgical, Inc. (NASDAQ:ISRG) Da Vinci system was used to perform over 2.2 million procedures, and over 9,400 Intuitive systems were found to be used in hospitals globally. This represents a growth of 22% in procedures undertaken with the Da Vinci system year-over-year.
Because of its use of AI and machine learning in surgical procedures, Intuitive Surgical, Inc. (NASDAQ:ISRG) has managed to grow its revenue at a 15% annual pace over the last six years, which highlights the fact that the company has been integrating AI and machine learning in its operations well before the AI boom ever came about. In 2024, Intuitive Surgical, Inc. (NASDAQ:ISRG) forecasted revenue growth of 13%, and in 2025, this forecasted growth is expected to increase to 16%. As this company appears to be a veteran in the use of AI in medicine, many investors are flocking to buy its stock because of its immense past growth and future growth potential.
We saw 67 hedge funds long Intuitive Surgical, Inc. (NASDAQ:ISRG) in the second quarter, with a total stake value of $6.4 billion.
Here’s what Baron Funds said about Intuitive Surgical, Inc. (NASDAQ:ISRG) in its second-quarter 2024 investor letter:
“Intuitive Surgical, Inc. (NASDAQ:ISRG) manufactures the da Vinci Surgical System, a robotic surgical system used for minimally invasive procedures. The stock performed well due to excitement about the company’s new robotic surgical system, the da Vinci 5, which offers enhanced imaging, force feedback, and other improvements. We continue to believe Intuitive has durable competitive advantages and will remain the market leader in robotic surgery. We think the company has a long runway for growth as more procedures are performed with the company’s equipment.”
While we acknowledge the growth potential of ISRG, our conviction lies in the belief that some AI stocks hold great promise for delivering high returns and doing so within a shorter timeframe. If you are looking for an AI stock that is more promising than ISRG but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
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