ISRG vs BSX: Which Medical Device Stock Has More Room to Run?

Globe and Mail

3 hours ago

In a healthcare landscape increasingly shaped by technology, two names that stand out for their innovation and long-term potential are Intuitive Surgical ISRG and Boston Scientific BSX. Both companies are at the forefront of minimally invasive procedures — Intuitive as the undisputed leader in robotic-assisted surgery, and Boston Scientific as a powerhouse in interventional medical devices.
With growing demand for advanced surgical solutions and aging global populations driving healthcare needs, investors are eyeing these med-tech giants as attractive long-term plays. But, which stock offers more compelling upside right now? Let's break down the fundamentals, growth trajectories, and market positions of ISRG and BSX to find out which one deserves a place in your portfolio.
ISRG & BSX: Price Performance
Intuitive Surgical represents a high-growth, high-premium pure play on robotic-assisted surgery. Its exceptional performance and growth provide compelling upside, but investors must accept margin compression and valuation risk in the short-to-medium term. Boston Scientific offers broader exposure to medical device innovation, with reliable growth driven by cardiovascular and interventional segments. It trades at a more moderate valuation and may appeal to investors seeking growth with less volatility.
The year-to-date price performance of Intuitive Surgical has not been impressive, likely due to tariff concerns and rising competition from Chinese robotic device makers. However, BSX has outperformed ISRG likely due to its diversified business as well as strong U.S. demand. Shares of ISRG have lost 1.9% year to date, while those of BSX have gained 13.9%.
Market Position & Core Offerings
Intuitive Surgical dominates the surgical robotics niche with its flagship da???Vinci system, which continues to gain traction globally — 367 new units placed in the first quarter of 2025 alone, leading to a 17% year-over-year increase in procedures. Boston Scientific, by contrast, operates across a broader landscape of interventional medical devices, from cardiovascular to neuromodulation. Its success with Farapulse pulsed field ablation and strong cardiovascular sales (+26% in first-quarter 2025) highlight its diversified growth drivers.
Growth & Performance
ISRG delivered robust first-quarter 2025 results: revenues grew 19% to $2.25 billion, adjusted net income rose 22% to $767.5 million, and adjusted EPS grew 21% to $1.81. Its projected procedure growth remains strong at 15-17% for the year, though margins may be pressured by tariffs.
BSX also posted solid first-quarter 2025 earnings, with adjusted EPS of $0.75 and sales worth $4.66 billion, both beating expectations on the back of cardiovascular and medical-surgical divisions. For the second quarter of 2025, revenues are expected to grow by double digits, driven by PFA and other interventions.
Estimates Comparison for ISRG & BSX
The Zacks Consensus Estimate for ISRG's fiscal 2025 sales and EPS implies a year-over-year improvement of 15.6% and 6.8%, respectively. EPS estimates for 2025 and 2026 have trended southward over the past 60 days.
ISRG Estimate Movement
The Zacks Consensus Estimate for Boston Scientific's 2025 sales and EPS implies a year-over-year improvement of 16.4% and 15.9%, respectively. Moreover, EPS estimates for 2025 and 2026 have improved over the past 60 days.
BSX Estimate Movement
Cash & Cash Flow
Intuitive Surgical maintains an exceptionally strong balance sheet, with $4.51 billion in cash and no debt as of the first quarter of 2025. The company generated free cash flow of around $465 million and operating cash flow of $582 million, driven by continued growth in da Vinci system procedures and high-margin recurring revenues from instruments and accessories.
Boston Scientific, operates with a more leveraged profile. The company reported $725 million in cash and $11.31 billion in total debt, with a debt-to-equity ratio of nearly 50%. Despite this, BSX maintains strong cash generation, posting $541 million in operating cash flow and $354 million in free cash flow for the first quarter of 2025 alone. Its diversified product base, especially in cardiovascular and electrophysiology, supports ongoing growth and debt service.
Risks & Operational Challenges
ISRG is exposed to geopolitical and trade-related tariff risks — especially a 125% tariff on Chinese exports — which have led to margin revisions for 2025. Mitigation efforts include supply-chain adjustments and pricing flexibility. BSX contends with regulatory and legal exposures (notably from past medical-device recalls and mesh product lawsuits), but its diversified supply chain and global footprint help buffer macroeconomic pressures.
ISRG or BSX: Which Is a Better Bet?
For investors focused on explosive, category-leading growth in surgical robotics, ISRG may still be the superior choice. But those who prefer balanced exposure across med-tech segments with a steadier valuation profile might consider BSX as a more diversified, resilient option.
Intuitive Surgical stands out for its pristine balance sheet, zero debt, and strong free cash flow, making it an appealing choice for investors prioritizing financial stability and growth. Boston Scientific's leveraged balance sheet is offset by a diversified product base and solid, consistent cash generation, positioning it as a resilient and innovative med-tech player for investors comfortable with moderate financial risk.
Both companies currently carry a Zacks Rank #3 (Hold). However, if we go by the Zacks Style Score, BSX seems to be a better bet compared to ISRG. While ISRG has a Zacks Style Score of 'D', BSX's score is 'C', reflecting better growth potential.
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