Intuitive Surgical Stock Trades Near Key Level During Pullback

The shares have pulled back sharply from their mid-April record high

The shares of Intuitive Surgical, Inc. (NASDAQ:ISRG) are down 6.6% to trade at $493.04, after the da Vinci Surgical System maker reported first-quarter adjusted profit of $2.61 per share, which was below the consensus estimate of $2.70 per share. And while the company's quarterly revenue of $974 million came in above expectations, no fewer than three brokerages have cut their ISRG price targets, with RBC setting the lowest bar at $550.

Not all of the analyst attention was negative, though, with Raymond James saying to "buy any weakness in the shares on the 1Q print as we anticipate that concerns related to optics of the in-line revenues are unlikely to persist," even as it cut its price target to $610 from $630. Most analysts are bullish on ISRG stock, with 14 of 16 brokerages maintaining a "buy" or better rating, and the consensus 12-month price target of $581.19 a healthy 10% premium to last Thursday's close at $528.06.

Options traders are upbeat toward Intuitive Surgical stock, too. At the International Securities Exchange (ISE), Chicago Board Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX), ISRG's 10-day call/put volume ratio of 1.67 ranks in the 87th annual percentile, meaning calls have been bought to open over puts at a quicker-than-usual clip.

It's not too surprising to see so much optimism levied toward the stock, given it's longer-term performance. After skimming an eight-month low of $430.24 on Dec. 25, ISRG shares surged all the way up to a record high of $589.32 by April 12. And while the stock closed last Thursday at $528.06 -- a 38.2% Fibonacci retracement of that recent rally -- it's testing the $490-$495 region today, home to a 61.8% retracement of trough-to-peak pop, as well as its 320-day moving average.