Robotics is no longer just a science fiction fantasy: robots are transforming our world in real time. From enhancing manufacturing and logistics to revolutionizing healthcare and everyday life, robots are used widely and are only expected to grow in the coming years.
With growth poised in this fast-growing sector, now may be a good time to consider investing in three fundamentally strong robotics stocks: Intuitive Surgical, Inc. (ISRG), Fanuc Corporation (FANUY), and iRobot Corporation (IRBT).
For example, Tesla (TSLA) recently introduced humanoid robots onto its production lines, with CEO Elon Musk suggesting that these robots could eventually surpass automotive revenues, while Amazon.com (AMZN) is ramping up its robotic workforce, leveraging 750,000 robots in its operations – a huge leap from years past.
Moreover, robots now perform many functions in the medical field, such as assisting in surgery, delivering supplies, cleaning, etc. From 2024 to 2031, the global robotics market is expected to reach $134.64 billion, expanding at a CAGR of 16.6%.
Additionally, investor interest in robotics stocks is evidenced by the Global X Robotics & Artificial Intelligence ETF’s (BOTZ) return of 34% over the past nine months.
With that in mind, investing in stocks of robotics companies like ISRG, FANUY, and IRBT could be profitable over the next few years. Let’s take a closer look at the fundamentals of these companies.
Intuitive Surgical, Inc. (ISRG)
ISRG designs, manufactures and sells primarily the Da Vinci Surgical System, the Ion Endoluminal System, and related instruments and accessories for invasive surgery worldwide. The company is known for its Da Vinci Surgical System, which is designed to assist surgeons in performing minimally invasive procedures.
The Company received updated label approval for da Vinci X and Xi from the FDA for use in radical prostatectomy on June 5, 2024. The approval is supported by real-world data demonstrating that robotic-assisted surgery results in long-term survival rates equivalent to traditional methods.
“This is an important step forward as it confirms non-inferior 10-year overall survival for patients undergoing radical prostatectomy with the da Vinci Surgical System,” said Miriam Curet, M.D., Intuitive’s chief medical officer.
In March, ISRG received FDA clearance for its next-generation da Vinci 5 multiport robotic system, which can be used in all surgical specialties and procedures indicated for the da Vinci Xi, with certain exceptions. This clearance expands ISRG’s market reach and strengthens its leadership in robotic-assisted surgery.
For the second fiscal quarter ending June 30, 2024, ISRG’s total revenue was $2.01 billion, up 14.5% year over year. The company’s non-GAAP gross profit was $1.41 billion for the quarter, up 16.9% year over year. Non-GAAP operating income was $754.1 million, up 22.1% year over year. ISRG’s non-GAAP net income was $641 million, up 26.4% year over year, and non-GAAP EPS was $1.78, up 25.3% year over year.
During the quarter, da Vinci procedures worldwide increased 17% year-over-year, with ISRG installing 341 da Vinci surgical systems, the same number as 331 systems in the second quarter of 2023. As of March 31, 2024, ISRG’s installed base of da Vinci surgical systems increased to 9,203, up 14% from 8,042 in 2023.
The consensus revenue estimate for the third quarter ending September 2024 is $2.01 billion, up 15% year over year. The consensus EPS estimate for the current quarter is $1.64, indicating 12.2% growth year over year. The company has an impressive track record of delivering earnings surprises, having surpassed consensus EPS estimates in each of the past four quarters.
Shares have risen 57.5% over the past nine months, closing at $436.74 in the most recent trading session, and are up 29.5% year-to-date.
ISRG’s stance is clearly visible in its POWR Ratings: the stock has grades of B for Sentiment and Quality. POWR Ratings are calculated by taking into account 118 different factors, each weighted to an optimal degree.
Of 135 stocks in the Medical Devices & Facilities industry, the stock is ranked 49th. To see additional ISRG Ratings (Growth, Value, Momentum, Stability) click here.
FANUC CORPORATION (FANUY)
Headquartered in Yamanashi, Japan, Fanyi specializes in factory automation products and serves customers around the world, including North and South America, Europe, China and other Asian regions. We offer CNC series products, servo motors, lasers, robots, small machining centers, electric injection molding machines, wire EDM machines and ultra-precision machinery.
On July 12, FANUC America Corporation, a subsidiary of FANUY, announced the completion of its new West Campus in Auburn Hills, Michigan. Built on approximately 270,000 square meters of land and with an investment of $110 million, this state-of-the-art facility is part of FANUC’s strategic plan to strengthen industrial automation in North America.
The West Campus is equipped with customized automation systems and a warehouse for the storage and rapid delivery of more than 6,000 robots and spare parts. This new facility follows the establishment of FANUC America’s headquarters, Chicago office and North Campus.
For the fiscal year ending March 31, 2024, Fanui’s net sales were JPY 795.27 billion ($5.19 billion), up 3.1% from the forecast of JPY 771.5 billion ($50.3 billion). Operating income and net income for the period were JPY 141.92 billion ($926.29 million) and JPY 133.16 billion ($869.12 million), respectively. Net income per share was JPY 140.23.
The Street expects FANUY’s fiscal 2024 (ending March 2025) revenue to grow 68.3% year over year to $5.14 billion. The company’s EPS for the current fiscal year is expected to increase 110.1% year over year to $0.10.
FANUY shares have risen 5.3% over the past nine months, closing at $13.04 in the last trading session.
FANUY’s POWR Ratings reflect this outlook, with Stability, Sentiment and Quality receiving grades of B. Out of 77 stocks, FANUY ranks 56th in the A-rated Industrial Machinery industry. To see more ratings for FANUY on Growth, Value and Momentum, click here.
iRobot Corporation (IRBT)
IRBT is a global consumer robotics company that designs and manufactures durable robots and intelligent home innovations that make life easier. The company’s portfolio of home robots and smart home devices includes technologies for the connected home and advanced concepts in cleaning, mapping and navigation, human-robot interaction, and physical solutions.
On July 23, IRBT launched the Roomba Combo 10 Max Robot with AutoWash™ Dock, its most advanced vacuum and mop. This 2-in-1 device autonomously refills, charges, washes, and self-cleans. With iRobot OS and Enhanced Dirt Detect™ technology, it identifies and targets the dirtiest areas up to 8x more frequently for a thorough clean. It is also the first iRobot model compatible with the Matter smart home protocol and the Apple Home ecosystem.
IRBT’s revenue for the first quarter ended March 30, 2024 was $357.87 million. Operating income was $11.9 million, with an operating loss of $81.3 million. Similarly, the company’s net income was $8.61 million, or $0.30 per share, up compared to a net loss of $81.11 million, or $2.95 per share, in the same period last year. Also, net cash flow from operations was $1.44 million, up compared to an outflow of $94.51 million in the same period last year.
Analysts expect IRBT’s third-quarter (ending September 2024) revenue to grow 11.3% year over year to $207.25 million. However, the company is expected to post a loss of $0.28 per share in the current quarter. Still, it has beat consensus EPS estimates in three of the past four quarters.
The stock has risen 86.8% over the past three months, closing the last trading session at $12.85.
IRBT’s POWR Ratings reflect these outlooks, with a grade of B for Growth, ranking it 33rd out of 59 stocks in the Home Improvement & Supplies industry.
In addition to what we’ve mentioned above, we also rate IRBT on Value, Momentum, Stability, Sentiment, and Quality. You can find all IRBT ratings here.
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ISRG shares were trading at $442.86 per share on Friday afternoon, up $6.12 (+1.40%). Year-to-date, ISRG is up 31.27%, while the benchmark S&P 500 index is up 15.34% over the same period.
About the Author: Shweta Kumari
Shweta’s deep interest in financial research and quantitative analysis led her to pursue a career as an investment analyst. She uses her knowledge to help individual investors make educated investment decisions. Read more…
