Revenue minus cost of goods sold. Graham's ≥40% threshold identifies businesses with durable pricing power. Note: software and financial companies naturally exceed this; retailers and manufacturers rarely reach it due to their cost structures.
Operating Margin34.2%
Profit after operating costs before interest and taxes. A consistent ≥15% operating margin signals a business with real competitive advantages. Capital-intensive industries (airlines, auto, commodities) rarely hit this threshold due to their structural cost base — compare within industry for context.
Net Income Margin17.1%
Bottom-line profit as a percentage of revenue. The ≥20% target reflects Buffett's preference for highly profitable businesses. Financial engineering (buybacks, tax optimisation) can inflate this temporarily — look for consistency across multiple years rather than a single strong result.
Financial Health
A
Working Capital$5.9B
Current Assets minus Current Liabilities. Negative working capital can be a deliberate efficiency strategy in businesses that collect cash before paying suppliers (retailers, fast food franchises, subscription businesses). Assess alongside free cash flow generation for full context.
Valuation
F
Margin of Safety0.0%
How far below the Graham Number the stock trades. Graham required a 33% discount as a buffer against analytical error. However, the Graham Number itself assumes 1960s-era P/E and P/B norms — for modern asset-light businesses it often understates true intrinsic value, making 0% MoS appear misleadingly bad.
Price-to-Book10.01x
Market price vs book value per share. Rarely below 1.5x for quality businesses today. Intangible assets (brand, software, patents) don't appear on the balance sheet under accounting rules, making P/B artificially high for asset-light companies like software and consumer brands.
Cash Flow
B
Free Cash Flow$1.1B
Operating cash flow minus capital expenditures. Buffett's most important metric — cash a business actually generates for its owners after maintaining and growing its asset base. Consistently positive FCF is one of the strongest indicators of a durable, well-run business regardless of accounting profits.
CapEx % of Net Income21.6%
Capital expenditure as a share of net income. Low CapEx signals a capital-light business that doesn't need heavy reinvestment to sustain earnings — Buffett's ideal. High CapEx is structurally necessary in manufacturing, airlines, telecoms, and semiconductors. For these industries, a high reading reflects the business model, not poor management.
Owner Earnings$849M
Net Income + Depreciation & Amortisation − Capital Expenditures. Buffett's preferred measure of a company's true annual earning power — what could theoretically be distributed to owners without impairing the business. More reliable than reported EPS because it accounts for the capital cost of maintaining the business.
About Intuitive Surgical, Inc.
Intuitive Surgical, Inc. develops, manufactures, and markets products that enable physicians and healthcare providers to enhance the quality of and access to minimally invasive care in the United States and internationally. It offers the da Vinci Surgical System that enables surgical procedures using a minimally invasive approach; and Ion endoluminal system, which extends its commercial offerings beyond surgery into diagnostic endoluminal procedures enabling minimally invasive biopsies in the lung. The company also provides a suite of stapling, energy, and core instrumentation for its multi-port da Vinci surgical systems; progressive learning pathways to support the use of its technology; infrastructure of customer service and support specialists, a complement of services to its customers, including installation, repair, maintenance, 24/7 technical support, and proactive system health monitoring; and integrated digital capabilities providing connected offerings, streamlining performance for hospitals with program-enhancing insights. It sells its products through direct sales organizations, such as capital and clinical sales teams. Intuitive Surgical, Inc. was incorporated in 1995 and is headquartered in Sunnyvale, California.
Intuitive Surgical, Inc. develops, manufactures, and markets products that enable physicians and healthcare providers to enhance the quality of and access to minimally invasive care in the United States and internationally. It offers the da Vinci Surgical System that enables surgical procedures using a minimally invasive approach; and Ion endoluminal system, which extends its commercial offerings beyond surgery into diagnostic endoluminal procedures enabling minimally invasive biopsies in the lung. The company also provides a suite of stapling, energy, and core instrumentation for its multi-port da Vinci surgical systems; progressive learning pathways to support the use of its technology; infrastructure of customer service and support specialists, a complement of services to its customers, including installation, repair, maintenance, 24/7 technical support, and proactive system health monitoring; and integrated digital capabilities providing connected offerings, streamlining performance for hospitals with program-enhancing insights. It sells its products through direct sales organizations, such as capital and clinical sales teams. Intuitive Surgical, Inc. was incorporated in 1995 and is headquartered in Sunnyvale, California.
Metric Explanations
What each dimension measures and where the thresholds come from.
Gross Profit Margin
Revenue minus cost of goods sold. Graham's ≥40% threshold identifies businesses with durable pricing power. Note: software and financial companies naturally exceed this; retailers and manufacturers rarely reach it due to their cost structures.
Operating Margin
Profit after operating costs before interest and taxes. A consistent ≥15% operating margin signals a business with real competitive advantages. Capital-intensive industries (airlines, auto, commodities) rarely hit this threshold due to their structural cost base — compare within industry for context.
Net Income Margin
Bottom-line profit as a percentage of revenue. The ≥20% target reflects Buffett's preference for highly profitable businesses. Financial engineering (buybacks, tax optimisation) can inflate this temporarily — look for consistency across multiple years rather than a single strong result.
Working Capital
Current Assets minus Current Liabilities. Negative working capital can be a deliberate efficiency strategy in businesses that collect cash before paying suppliers (retailers, fast food franchises, subscription businesses). Assess alongside free cash flow generation for full context.
Margin of Safety
How far below the Graham Number the stock trades. Graham required a 33% discount as a buffer against analytical error. However, the Graham Number itself assumes 1960s-era P/E and P/B norms — for modern asset-light businesses it often understates true intrinsic value, making 0% MoS appear misleadingly bad.
Price-to-Book
Market price vs book value per share. Rarely below 1.5x for quality businesses today. Intangible assets (brand, software, patents) don't appear on the balance sheet under accounting rules, making P/B artificially high for asset-light companies like software and consumer brands.
Free Cash Flow
Operating cash flow minus capital expenditures. Buffett's most important metric — cash a business actually generates for its owners after maintaining and growing its asset base. Consistently positive FCF is one of the strongest indicators of a durable, well-run business regardless of accounting profits.
CapEx % of Net Income
Capital expenditure as a share of net income. Low CapEx signals a capital-light business that doesn't need heavy reinvestment to sustain earnings — Buffett's ideal. High CapEx is structurally necessary in manufacturing, airlines, telecoms, and semiconductors. For these industries, a high reading reflects the business model, not poor management.
Owner Earnings
Net Income + Depreciation & Amortisation − Capital Expenditures. Buffett's preferred measure of a company's true annual earning power — what could theoretically be distributed to owners without impairing the business. More reliable than reported EPS because it accounts for the capital cost of maintaining the business.
Mr. Market is currently offering Intuitive Surgical, Inc. at $452.80.
The business passes only 2 of 6 of Graham's defensive criteria — well below his required standard.
At $452.80, the stock trades at a 1063% premium to its Graham Number of $38.95. Graham would consider this price speculative.
There is no margin of safety at the current price. Graham would advise patience and waiting for a better entry point.
Trading at 30.8x NCAV. Expected for most quality businesses — NCAV was designed to find depression-era bargains and rarely applies to modern profitable companies..
Conclusion: By Graham's standards, this stock is speculative at its current price. The intelligent investor would look elsewhere or wait.
Showing Key Metrics
Income Highlights
Metric
Q3 2026
Q4 2025
Gross Profit %
68.4%▲
66.4%
Operating Margin %
34.2%▲
30.2%
Net Income %
17.1%▼
27.7%
Diluted EPS
1.49▼
2.21
Balance Sheet Highlights
Metric
Q3 2026
Q4 2025
Total Assets
$19.3B
$20.5B
Total Debt
N/A•
N/A
Working Capital
$5.9B▼
$7.8B
Years to Pay Debt
N/A
N/A
Cash Flow Highlights
Metric
Q3 2026
Q4 2025
Free Cash Flow
$1.1B▲
$730M
Owner Earnings
$849M
$1.2B
CapEx % of Net Income
21.6%
20.4%
Income Statement
2026
2025
Tax Effect Of Unusual Items
-96,750
0
Tax Rate For Calcs
0
0
Normalized EBITDA
1,705,500
1,085,200
Total Unusual Items
-450,000
Total Unusual Items Excluding Goodwill
-450,000
Net Income From Continuing Operation Net Minority Interest
522,800
794,800
Reconciled Depreciation
212,900
220,900
Reconciled Cost Of Revenue
964,400
961,900
EBITDA
1,255,500
1,085,200
EBIT
1,042,600
864,300
Net Interest Income
75,800
91,300
Interest Income
75,800
91,300
Normalized Income
876,050
794,800
Net Income From Continuing And Discontinued Operation
522,800
794,800
Total Expenses
2,006,100
2,001,900
Total Operating Income As Reported
592,600
864,300
Diluted Average Shares
351,600
360,400
Basic Average Shares
349,000
354,900
Diluted EPS
0
0
Basic EPS
0
0
Diluted NI Availto Com Stockholders
522,800
794,800
Net Income Common Stockholders
522,800
794,800
Net Income
522,800
794,800
Minority Interests
-1,600
-4,700
Net Income Including Noncontrolling Interests
524,400
799,500
Net Income Continuous Operations
524,400
799,500
Tax Provision
144,000
156,100
Pretax Income
668,400
955,600
Other Income Expense
-450,000
Special Income Charges
-450,000
Other Special Charges
450,000
Net Non Operating Interest Income Expense
75,800
91,300
Interest Income Non Operating
75,800
91,300
Operating Income
1,042,600
864,300
Operating Expense
1,041,700
1,040,000
Research And Development
408,300
352,900
Selling General And Administration
633,400
687,100
Gross Profit
2,084,300
1,904,300
Cost Of Revenue
964,400
961,900
Total Revenue
3,048,700
2,866,200
Operating Revenue
3,048,700
2,866,200
Balance Sheet
2026
2025
Ordinary Shares Number
353,278
355,100
Share Issued
353,278
355,100
Tangible Book Value
15,231,700
17,442,600
Invested Capital
15,986,200
17,824,000
Working Capital
5,895,300
7,773,300
Net Tangible Assets
15,231,700
17,442,600
Common Stock Equity
15,986,200
17,824,000
Total Capitalization
15,986,200
17,824,000
Total Equity Gross Minority Interest
16,117,800
17,941,700
Minority Interest
131,600
117,700
Stockholders Equity
15,986,200
17,824,000
Gains Losses Not Affecting Retained Earnings
-60,300
43,300
Other Equity Adjustments
-60,300
43,300
Retained Earnings
4,525,100
7,011,800
Additional Paid In Capital
11,521,100
10,768,500
Capital Stock
300
400
Common Stock
300
400
Total Liabilities Net Minority Interest
3,231,300
2,517,000
Total Non Current Liabilities Net Minority Interest
698,300
510,800
Other Non Current Liabilities
296,500
225,800
Tradeand Other Payables Non Current
273,600
193,600
Non Current Deferred Liabilities
128,200
91,400
Non Current Deferred Revenue
128,200
91,400
Current Liabilities
2,533,000
2,006,200
Current Deferred Liabilities
541,200
506,700
Current Deferred Revenue
541,200
506,700
Pensionand Other Post Retirement Benefit Plans Current
505,900
648,400
Payables And Accrued Expenses
1,485,900
851,100
Current Accrued Expenses
987,600
470,600
Payables
498,300
380,500
Total Tax Payable
218,800
125,400
Accounts Payable
279,500
255,100
Total Assets
19,349,100
20,458,700
Total Non Current Assets
10,920,800
10,679,200
Other Non Current Assets
1,012,500
837,600
Non Current Deferred Assets
719,700
1,018,600
Non Current Deferred Taxes Assets
719,700
1,018,600
Investments And Advances
2,757,900
3,099,200
Investmentin Financial Assets
2,757,900
3,099,200
Available For Sale Securities
2,757,900
3,099,200
Goodwill And Other Intangible Assets
754,500
381,400
Other Intangible Assets
196,700
11,100
Goodwill
557,800
370,300
Net PPE
5,676,200
5,342,400
Accumulated Depreciation
-2,276,500
Gross PPE
7,618,900
Construction In Progress
638,100
Machinery Furniture Equipment
1,570,600
Buildings And Improvements
2,833,900
Land And Improvements
479,700
Current Assets
8,428,300
9,779,500
Other Current Assets
352,000
376,400
Prepaid Assets
80,600
Inventory
2,128,200
1,840,000
Finished Goods
1,142,700
991,000
Work In Process
333,200
287,900
Raw Materials
652,300
561,100
Receivables
1,825,000
1,628,200
Receivables Adjustments Allowances
-28,500
Other Receivables
381,700
100,900
Accounts Receivable
1,471,800
1,527,300
Allowance For Doubtful Accounts Receivable
-29,900
Gross Accounts Receivable
1,557,200
Cash Cash Equivalents And Short Term Investments
4,042,500
5,934,900
Other Short Term Investments
1,064,400
2,566,900
Cash And Cash Equivalents
2,978,100
3,368,000
Cash Equivalents
2,328,700
2,853,100
Cash Financial
649,400
514,900
Cash Flow
2026
2025
Free Cash Flow
1,111,000
730,000
Repurchase Of Capital Stock
-2,975,700
-201,000
Capital Expenditure
-113,100
-162,500
End Cash Position
3,022,400
3,407,400
Beginning Cash Position
2,805,700
2,849,500
Effect Of Exchange Rate Changes
-11,600
12,300
Changes In Cash
228,300
545,600
Financing Cash Flow
-2,893,600
-137,500
Cash Flow From Continuing Financing Activities
-2,893,600
-137,500
Net Other Financing Charges
-14,300
-13,100
Proceeds From Stock Option Exercised
96,400
76,600
Net Common Stock Issuance
-2,975,700
-201,000
Common Stock Payments
-2,975,700
-201,000
Investing Cash Flow
1,897,800
-209,400
Cash Flow From Continuing Investing Activities
1,897,800
-209,400
Net Investment Purchase And Sale
2,001,300
-34,200
Sale Of Investment
2,112,500
390,800
Purchase Of Investment
-111,200
-425,000
Net Business Purchase And Sale
9,600
-12,700
Sale Of Business
0
Purchase Of Business
9,600
-12,700
Net PPE Purchase And Sale
-113,100
-162,500
Purchase Of PPE
-113,100
-162,500
Operating Cash Flow
1,224,100
892,500
Cash Flow From Continuing Operating Activities
1,224,100
892,500
Change In Working Capital
337,700
-248,400
Change In Other Working Capital
-142,200
140,300
Change In Other Current Liabilities
595,000
28,900
Change In Payables And Accrued Expense
234,400
41,100
Change In Accrued Expense
Change In Payable
4,700
-39,100
Change In Account Payable
4,700
-39,100
Change In Prepaid Assets
11,300
61,800
Change In Inventory
-307,400
-253,000
Change In Receivables
-53,400
-267,500
Changes In Account Receivables
-53,400
-267,500
Other Non Cash Items
Stock Based Compensation
212,600
203,300
Deferred Tax
-54,400
-39,500
Deferred Income Tax
-54,400
-39,500
Depreciation Amortization Depletion
212,900
220,900
Depreciation And Amortization
212,900
220,900
Amortization Cash Flow
25,100
52,500
Amortization Of Intangibles
25,100
52,500
Depreciation
187,800
168,400
Operating Gains Losses
-9,100
-15,900
Gain Loss On Investment Securities
-9,100
-14,900
Gain Loss On Sale Of Business
0
Net Income From Continuing Operations
524,400
799,500
📊Quarterly mode — Graham Fair Value & 7 Criteria require annual data. Switch to Annual for full analysis.
Quarter vs Same Quarter Last Year
YoY strips seasonality
Revenue Growth (YoY)
Prior year: $2.5B▲ $3.0B+21.7%
Revenue growth vs same quarter last year strips seasonality. Consistent double-digit growth is a Buffett hallmark.
Gross Margin
Prior year: 66.4%▲ 68.4%+2.0pp
Buffett: consistent gross margin above 40% signals durable pricing power and competitive moat.
Operating Margin
Prior year: 41.6%▲ 34.2%-7.4pp
Graham: operating margin reflects true business economics before financing. Trend matters as much as level.
Net Margin
Prior year: 28.1%▼ 17.1%-11.0pp
Net margin can be distorted by one-time items, tax timing, or interest costs — compare to operating margin for signal quality.
Quarterly Health Checks
3 Graham/Buffett criteria that are valid and reliable on quarterly data
✅ Adequate Size
Graham required scale for resilience. Quarterly revenue × 4 gives an annualised proxy.
$3.0B/qtr (≈$12.2B ann.)
vs > $1.5B annualised revenue
✅ Financial Condition
Current assets vs current liabilities — a real-time liquidity snapshot. Valid and reliable on quarterly data.
3.33x current ratio
vs ≥ 2.0x
✅ Free Cash Flow
Buffett's most important single metric. A positive FCF quarter means the business generated real cash for owners after maintaining its asset base.
$1.1B
vs Positive
Operating Cash Flow
$1.2B
Latest quarter · Buffett's cash reality check
ROIC
4.9%
Based on latest annual operating income
Return on Invested Capital — Buffett's preferred measure for asset-light businesses. ROIC > 15% consistently signals a durable competitive advantage (moat). More meaningful than P/B for software, pharma, and consumer brand companies where most value is intangible and off-balance-sheet.
Market Cap / Net Assets
9.9x
Net Assets: $16.1B
⚠️Net margin compressed 11.0pp vs same quarter last year. Common causes: one-time charges (restructuring, write-downs, legal settlements), tax rate changes, or rising interest expense. Check the income statement notes before drawing conclusions about operating health.
⚠️Revenue grew vs prior year but operating margin contracted. Possible explanations: deliberate investment in growth (hiring, marketing, R&D), input cost inflation, or pricing pressure from competition. Buffett distinguishes between spending that builds moat vs. spending that doesn't.
Peers & Industry
No auto-detected peers for Medical Instruments & Supplies. You can manually compare ISRG against any stock using the Compare tool.
"The management of a business is its most important single factor — more important than market position, patents, or financial structure."
— Benjamin Graham
Capital Allocation & Alignment
Insider Ownership
0.52%
Low — management has little skin in the game
Return on Equity (ROE)
3.3%
Weak — poor returns on equity
Return on Assets (ROA)
2.7%
Fair — average asset utilization
Share Buybacks (Latest Year)
$2.3B
Management is returning capital to shareholders via buybacks
Leadership Team
David Rosa
CEO & Director
Age 57
Pay: $2,322,608
0.444% of net income
Jamie Samath
Executive VP, CFO & Enterprise Technology Leader
Age 54
Pay: $1,481,816
0.283% of net income
Christopher Carlson Ph.
Executive Vice President of Research, Corporate Development, Corporate Strategy & Intuitive Ventures
Top Institutional Holders
Institution
% Owned
Shares
Blackrock Inc.
8.66%
30,024,648
Vanguard Capital Management LLC
6.67%
23,131,099
State Street Corporation
4.63%
16,063,040
Invesco Ltd.
3.42%
11,843,563
Price (T.Rowe) Associates Inc
3.25%
11,256,570
Geode Capital Management, LLC
2.46%
8,534,767
Capital World Investors
2.23%
7,742,681
Vanguard Portfolio Management LLC
2.09%
7,243,264
Risk Analysis
Beta (Market Risk)
1.44
Moderate volatility — moves slightly more than market
Short Interest
2.1% of float
Low short interest — market is not heavily bearish
Current Ratio
3.33x
Strong liquidity — Graham approved
52-Week Price Range
Low: $328.57Current: $452.80High: $603.88
Currently at 45% of 52-week range
Intuitive Surgical, Inc. (ISRG) fundamental analysis — Overall grade C based on profitability, financial health, valuation and cash flow. Graham's
Fair Value: $38.95. Margin of safety: 0%. Gross profit margin: 68.4%. Operating margin: 34.2%. Net margin: 17.1%. Market cap: $160.0B. Sector: Healthcare. Industry: Medical Instruments & Supplies. Analysis powered by 360investing — free fundamental stock analysis based on Benjamin Graham and Warren Buffett
principles.
Disclaimer: 360investing is provided for informational and educational purposes only and does not constitute financial, investment, legal, or tax advice. All data is sourced from public third-party providers
and may be delayed, inaccurate, or incomplete. Past performance is not indicative of future results. Analysis, scores, and valuations are algorithmic and do not represent professional investment recommendations. Always conduct your own due
diligence and consult a qualified financial adviser before making any investment decision. Use of this tool constitutes acceptance that 360investing and its operators bear no liability for decisions made based on information presented here.