Assessing Intuitive Surgical (ISRG) Valuation After Recent 12% Year To Date Share Price Decline

Simply Wall St

Wed, February 25, 2026 at 8:15 AM GMT+9 3 min read

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Intuitive Surgical (ISRG) is back in focus after recent trading left the stock with a year to date total return of about negative 12%. This has prompted investors to reassess how its valuation lines up with fundamentals.

See our latest analysis for Intuitive Surgical.

While the latest share price of US$494.02 leaves Intuitive Surgical with a 30 day share price return of about a 6% decline and a year to date share price return of about a 12% decline, the longer view is different. The company has a 3 year total shareholder return of about 115% and a 5 year total shareholder return of about 98%. This suggests that recent weakness contrasts with historically strong compounding for long term holders.

If this pullback has you reassessing where growth could come from next, it might be worth scanning our list of 28 healthcare AI stocks as another way to spot opportunities in medical technology and AI.

So with the share price under pressure, revenue at US$10.06b and net income at US$2.86b, the key question is whether Intuitive Surgical is now trading below its fundamentals or if the market is already pricing in future growth.

Most Popular Narrative: 19.3% Undervalued

With Intuitive Surgical closing at $494.02 against a narrative fair value of $611.82, the current price sits well below that central estimate built on projected growth, margins and discounting future cash flows at 7.67%.

Ongoing product innovation (including full launch of da Vinci 5, integrated force feedback, and digital/AI case insights), coupled with R&D to expand into adjacent specialties, enhances clinical outcomes and surgeon efficiency supporting future procedure growth, higher system ASPs, and increased recurring instrument and accessory revenues.

Read the complete narrative.

Curious what kind of revenue runway and earnings profile justify that gap between fair value and today’s price? The narrative leans heavily on sustained procedure growth, expanding use cases and a rich future profit multiple. Want to see how those ingredients fit together across the next few years without giving away every assumption up front?

Result: Fair Value of $611.82 (UNDERVALUED)

Have a read of the narrative in full and understand what’s behind the forecasts.

However, this narrative can unwind if competition erodes revenue from high margin instruments or if tighter hospital budgets globally slow system placements and procedure growth.

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

Story Continues  

Another View: Multiples Point to a Richer Price Tag

That 19.3% discount to the narrative fair value sits awkwardly next to how the market is actually pricing Intuitive Surgical today. On a P/E of 61.2x, the stock trades at nearly double the US Medical Equipment industry average of 30.9x and well above its own fair ratio of 37.6x.

If the market eventually leans closer to that 37.6x fair ratio or nearer to peers at 35.4x, today’s price starts to look less like a discount and more like a premium investors are paying up front. So is the real risk missing upside, or overpaying for a great business?

See what the numbers say about this price — find out in our valuation breakdown.

NasdaqGS:ISRG P/E Ratio as at Feb 2026

Next Steps

With such mixed signals around price and potential, it helps to move quickly and check the facts yourself so you are not relying on headlines alone. Take a closer look at the balance of upside factors in our 3 key rewards and decide whether the optimism around this story fits your own view.

Looking for more investment ideas?

If Intuitive Surgical feels fully priced for your portfolio, consider broadening your watchlist now so you have more options before the next round of headlines.

Target potential value opportunities by scanning our list of 51 high quality undervalued stocks to see which companies the numbers suggest may be trading below their fundamentals.

Strengthen your income stream by checking out the 16 dividend fortresses, designed for investors who want higher yields while still paying attention to balance sheet quality.

Reduce portfolio stress by focusing on resilience first, using our 78 resilient stocks with low risk scores to identify companies with lower risk scores across key financial checks.

_ This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned._

Companies discussed in this article include ISRG.

Have feedback on this article? Concerned about the content? Get in touch with us directly._ Alternatively, email editorial-team@simplywallst.com_

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