Intuitive Surgical, Inc. (ISRG) Intrinsic Value & DCF Valuation
Medical - Instruments & Supplies · NASDAQ
Current Price
$353.10
Intrinsic Value
$384.73
+8.2% margin of safety
What Is Intuitive Surgical, Inc.'s Intrinsic Value?
As of 2026-07-29, the base-case DCF model estimates the intrinsic value of Intuitive Surgical, Inc. (ISRG) at $384.73 per share, compared with a market price of $353.1, a margin of safety of +8.2%. The base case assumes 14.4% annual free cash flow growth and a 10.0% discount rate.
Across the sensitivity grid the estimate spans $323.39 to $454.08. Intrinsic value is an estimate built on assumptions, not a fact. A higher discount rate or slower growth pushes the estimate down, while stronger cash flow growth lifts it.
How the DCF works · Recalculate with your own assumptions · What is intrinsic value?
Is Intuitive Surgical, Inc. (ISRG) Undervalued?
At $353.1, ISRG trades about 8.2% below the base-case intrinsic value estimate. That is a real discount, but it stays short of the 30% margin of safety required before calling a stock undervalued.
COMPETITIVE MOAT
↑Robotic Surgery Pioneer
Intuitive Surgical's early entry and sustained innovation in robotic-assisted surgery created a significant first-mover advantage. This established them as the dominant player in a nascent market.
↑Surgeon Training & Ecosystem
Extensive surgeon training programs and a proprietary ecosystem of instruments and accessories create high switching costs for hospitals and surgeons. This deep integration fosters loyalty.
↑Data & Performance Insights
The vast amount of data collected from da Vinci system procedures provides unique insights for product development and performance optimization. This scale advantage is difficult for competitors to replicate.
INVESTMENT RISKS
↓Valuation Concerns
The company's premium valuation, as highlighted by comparisons to competitors like Stryker, could make it susceptible to significant price corrections if growth expectations are not met.
↓Regulatory Scrutiny
As a leader in a critical medical field, Intuitive Surgical faces ongoing regulatory oversight and potential changes in approval processes for new devices and procedures.
↓Diversification vs. Specialization
Unlike more diversified healthcare companies like Abbott Laboratories, ISRG's focus on robotic surgery makes it more vulnerable to sector-specific headwinds or shifts in surgical trends.
Base case
ISRG base case valuation
Intrinsic Value
$384.73
Margin of safety
+8.2%
Expected annual return
+1.7%
Base case assumptions: 14.4% annual growth, 10.0% discount rate, 30x exit multiple, 5 year projection. Data as of 2026-07-29.
This base case uses default assumptions and is not financial advice. The intrinsic value changes significantly when the growth rate or discount rate changes. Open the calculator to set your own assumptions and see the full sensitivity range.
Customize the ISRG valuation
Adjust the growth rate, discount rate, and exit multiple to see how the intrinsic value and margin of safety for Intuitive Surgical, Inc. respond.
Open DCF Calculator for ISRGCompany Overview
Intuitive Surgical, Inc. is a leading medical technology firm dedicated to advancing patient care by developing, producing, and commercializing sophisticated tools. These innovations empower medical professionals to deliver superior, accessible, and less-invasive treatment options to patients both within the United States and across international markets. Its flagship offering, the da Vinci Surgical System, facilitates intricate operations through a minimally disruptive approach. Expanding beyond surgical applications, the company also provides the Ion endoluminal system, designed for diagnostic interventions like minimally invasive lung biopsies. Complementing its primary systems, Intuitive Surgical supplies a comprehensive array of instruments, including stapling tools, energy devices, and essential core components. Furthermore, it offers structured training programs to ensure proficient use of its technology, alongside extensive customer support services encompassing installation, repairs, and ongoing maintenance. The firm also integrates digital capabilities to deliver unified, connected solutions that optimize hospital performance through actionable insights. Established in 1995, Intuitive Surgical maintains its corporate headquarters in Sunnyvale, California.
Financial Metrics — ISRG Stock Valuation Data
Revenue/Share (TTM)
$31.13
FCF/Share (TTM)
$9.09
ROIC (TTM)
15.1%
ROE (TTM)
17.8%
P/FCF
38.7x
EV/EBITDA
27.1x
FCF Yield
2.58%
Debt/Equity
0.00x
On a trailing twelve-month basis, ISRG generates free cash flow per share of $9.09 alongside a ROIC of 15.1%, both central inputs for a DCF valuation. Its P/FCF ratio of 38.7x and FCF yield of 2.58% then frame how ISRG is priced against peers on a cash flow basis.
Frequently Asked Questions
What is the intrinsic value of ISRG?
Intuitive Surgical, Inc. currently generates $9.09 in free cash flow per share. At the current price of $353.10, a DCF model would discount these cash flows at an appropriate WACC and apply a terminal growth rate to arrive at an intrinsic value. The result depends heavily on your growth and discount rate assumptions — a 1% change in WACC typically shifts the fair value estimate by 10-15%. In MiniValuator the model uses a single discount rate that you can edit directly, 10% by default, rather than a computed WACC.
Is ISRG undervalued?
ISRG trades at a P/FCF ratio of 38.7x with a free cash flow yield of 2.58%. This P/FCF is in a moderate range. However, whether ISRG is truly undervalued requires comparing the DCF intrinsic value to the current market price and evaluating whether the margin of safety is sufficient for your risk tolerance.
How do I value ISRG stock using DCF?
To perform a DCF valuation on Intuitive Surgical, Inc.: (1) Start with the trailing free cash flow per share ($9.09) as the base, (2) project future FCF growth over 5-10 years based on Medical - Instruments & Supplies industry trends and company fundamentals, (3) apply a discount rate (WACC) reflecting ISRG's risk profile — with a debt-to-equity of 0.00x, capital structure is an important factor, and (4) add a terminal value for cash flows beyond the projection period.
What is DCF valuation and how does it apply to ISRG?
DCF (Discounted Cash Flow) estimates what a company is worth today based on its future cash generation. For Intuitive Surgical, Inc., this means projecting how much free cash flow the company will produce over the next 5-10 years, shaped by Medical - Instruments & Supplies trends, then discounting those amounts to today's dollars. ISRG's ROIC of 15.1% reflects how efficiently the company converts invested capital into profit.
How does WACC affect ISRG stock valuation?
WACC (Weighted Average Cost of Capital) is the discount rate in a DCF model — it reflects the minimum return investors require. For ISRG, with a debt-to-equity ratio of 0.00x, the capital structure directly influences WACC. A 1% increase in WACC typically reduces the intrinsic value by 10-15%. At an EV/EBITDA of 27.1x, the market's implied discount rate can be reverse-engineered for comparison. In MiniValuator you set this discount rate yourself as a single editable number, 10% by default, instead of computing a formal WACC.
Learn More
- See ISRG PE Valuation → — Earnings-based stock valuation using PE ratio analysis
- DCF Methodology — Step-by-step guide to discounted cash flow analysis
- PE Methodology — Guide to PE ratio stock valuation
- WACC — Understanding the discount rate used in DCF
- Margin of Safety — How to evaluate downside protection
- Intrinsic Value — How to evaluate stock fair value
- How to Calculate Intrinsic Value — Complete guide for investors
Related Valuations
All Healthcare valuationsDCF and P/E value ISRG with different methods and assumptions, so the two conclusions can differ. Compare the P/E fair value.
Price as of 2026-07-29. Financial data from Financial Modeling Prep (trailing twelve months) · Valuation methodology by Charlie Wang.
This is an estimate, not investment advice.