Nvidia stock rises ahead of 2025 GTC
Nvidia (NVDA) shares pop during Friday's trading session, making up for being among the "Magnificent Seven" names that dragged the market lower during the recent tech-driven downturn.
Market Domination host Julie Hyman and Yahoo Finance Head of News Myles Udland take a closer look at the price action.
To watch more expert insights and analysis on the latest market action, check out more Market Domination here.
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Yahoo
2 hours ago
- Yahoo
Healthcare Sector Taps AI Boom via Intuitive Surgical Stock (ISRG)
When investors think of artificial intelligence (AI), names like Nvidia (NVDA), Palantir (PLTR), and Alphabet (GOOGL) typically come to mind. But AI's impact extends well beyond the traditional tech sector. A standout example is Intuitive Surgical (ISRG), the clear global leader in robotic surgery, now making significant strides in integrating AI into healthcare. The company's latest system, the da Vinci 5, incorporates AI capabilities that could unlock a powerful new and recurring revenue stream. Easily unpack a company's performance with TipRanks' new KPI Data for smart investment decisions Receive undervalued, market resilient stocks right to your inbox with TipRanks' Smart Value Newsletter Despite its leadership position, Intuitive Surgical's stock remains more than 15% below its all-time high, primarily due to competitive concerns, which may offer a compelling entry point for long-term investors. Given Intuitive Surgical's strong technological moat, I believe concerns about competition are overstated. The company's sustained innovation and market leadership position it well to remain a long-term winner. Thanks to the widespread adoption of its flagship da Vinci system, Intuitive Surgical commands an estimated 60% share of the global robotic surgery market in 2024. Once a system is installed, the company benefits from a steady stream of recurring revenue through the sale of consumables such as surgical instruments. Additionally, hospitals often choose to upgrade their systems over time to stay aligned with the latest technology, further reinforcing this revenue model. In 2024, Intuitive Surgical generated $8.4 billion in revenue, marking a 17% year-over-year increase—a testament to its ability to effectively monetize its platform. But beyond the strong financials, the company's intangible advantages significantly deepen its competitive moat. Over the past three decades, the da Vinci system has amassed an extensive base of real-world clinical data, contributing to better patient outcomes—something that is difficult, if not impossible, for competitors to replicate quickly. Moreover, Intuitive Surgical is deeply embedded in healthcare systems worldwide. Hospitals invest heavily in training surgical teams, adapting clinical protocols, and integrating the technology into their workflows. This creates substantial switching costs and a high degree of operational lock-in. Even if a competitor were to offer a lower-cost alternative, the economic and logistical barriers to switching remain a significant deterrent. Launched in early 2024, the da Vinci 5 introduces advanced AI capabilities that could further solidify Intuitive Surgical's dominance in the robotic surgery market. This latest system marks a significant shift—from basic surgical automation to intelligent surgical augmentation. According to the company, the da Vinci 5 delivers 10,000 times the computing power of previous models, enabling it to process complex data in real-time and provide intelligent, context-aware support to surgeons during procedures. This enhanced computing power allows the system to capture and analyze detailed intraoperative data, which can then be used to optimize surgical workflows, tool usage, and procedural techniques. Over time, this creates a powerful data-driven flywheel, continuously improving outcomes and efficiency in the operating room, deepening Intuitive Surgical's competitive edge. Admittedly, the competitive landscape in surgical robotics is becoming increasingly dynamic. Medtronic (MDT), a long-standing medtech leader, is preparing to launch its robotic-assisted surgery (RAS) system, Hugo, with FDA approval expected later this year. Hugo is positioned to compete in soft tissue procedures such as urology and gynecology, as well as spine surgery, and is expected to leverage AI as a key differentiator. Meanwhile, Johnson & Johnson (JNJ) is advancing its Ottava system through clinical trials, targeting procedures like gastric bypass and hiatal hernia repair, directly competing with da Vinci in the minimally invasive space. Ottava features four robotic arms integrated into a standard surgical table, a design that aims to improve workflow efficiency by reducing equipment footprint in the operating room. Additionally, Stryker's Mako system continues to gain traction in orthopedic procedures, including hip, knee, spine, and shoulder surgeries. While Intuitive Surgical remains the clear leader in robotic-assisted soft tissue surgery, these emerging systems reflect a broader push by competitors to gain ground across various surgical specialties. While Intuitive Surgical's 60% market share may face some erosion as competition intensifies, the robotic surgery market is both vast and expanding, providing ample room for multiple players to thrive. Importantly, Intuitive Surgical's first-mover advantage remains a significant asset, having established deep clinical integration and brand trust over the course of several decades. Crucially, the company is consistently profitable and continues to invest heavily in research and development, reinforcing its ability to innovate and stay ahead of emerging competitors. These factors should help Intuitive Surgical sustain its leadership position even as the market evolves. On Wall Street, ISRG earns a Strong Buy consensus rating based on 18 Buy, two Hold, and one Sell ratings in the past three months. ISRG's average price target of $596.35 implies a 14.15% upside potential over the next twelve months. Earlier this week, William Blair analyst Brandon Vazquez maintained a Buy rating on ISRG. He addressed concerns over the emergence of third-party remanufactured instruments, which could threaten the company's highly profitable and recurring instruments and accessories segment. The analyst 'believes that the limited availability of FDA-cleared remanufactured instruments and the absence of third-party verification participation will likely restrict their widespread adoption. Vazquez also notes that hospitals may be hesitant to operate outside Intuitive Surgical's ecosystem due to the high costs and risks associated with robotics programs.' The launch of the da Vinci 5 marks Intuitive Surgical's formal entry into the AI space, reinforcing its position at the forefront of the evolving robotic surgery market, even as competition intensifies. That said, several risks extend beyond the competitive landscape. Despite its recent pullback, Intuitive Surgical remains richly valued, trading at a P/E ratio of 77.2, which is well above that of its industry peers, leaving limited margin for error. The company also faces external pressures, including tariffs (estimated to impact about 1.7% of revenue) and the complexities of global expansion. Additionally, it is exposed to broader healthcare and regulatory shifts, such as the potential decline in bariatric surgery volumes resulting from the increasing use of GLP-1 medications. As AI becomes more central to its platform, data privacy concerns may also present regulatory and reputational challenges. Ultimately, Intuitive Surgical's strong market leadership and early integration of AI in a large, rapidly evolving industry give me confidence in the company's long-term potential, despite the presence of near-term risks and challenges. Disclaimer & DisclosureReport an Issue Sign in to access your portfolio
Yahoo
4 hours ago
- Yahoo
Lennar earnings, retail sales, Fed meeting: What to Watch
Market Domination Overtime host Julie Hyman previews the top market stories and headlines Wall Street will be paying attention to throughout next week, including corporate earnings out from companies like homebuilder Lennar (LEN) and firearm manufacturer Smith & Wesson (SWBI), the latest economic data in the form of retail sales and home builder confidence, and the Federal Reserve kicking off its June FOMC meeting on Tuesday, June 17. To watch more expert insights and analysis on the latest market action, check out more Market Domination Overtime here. Time now for what to watch next week. Starting on the earnings front, we got more earnings coming in next week from Lennar, Lazy Boy, and Smith & Wesson. Lennar announcing results for the second quarter on Monday. Analysts are expecting home sales to go up, selling roughly 23,000 homes last quarter. That's around 8% more year over year. Taking a look at the consumer, we'll be getting monthly US retail sales data for May on Tuesday. Economists forecast total sales will fall 0.7%, signaling that consumers are buying less amid elevated interest rates and that tariff uncertainty. Moving over to housing, we'll get some fresh data coming in next week, including housing starts and building permits on Wednesday. Housing starts expected to hold steady at 1.3 million at an annual pace, while building permits tick up to 1.43 million. And finally, of course, the Federal Reserve will kick off its June FOMC meeting on Tuesday. The interest rate decision will come on Wednesday. Fed chair, J. Powell, giving a press conference after the decision. And Yahoo Finance will be starting coverage on Wednesday at 2:00 p.m. Eastern. We'll also get a new dot plot. Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Yahoo
5 hours ago
- Yahoo
Barbie maker Mattel teams with OpenAI to change future of play
Mattel (MAT) is teaming up with OpenAI to integrate the latter's artificial intelligence tools into its toys. The Toy Book editor in chief and The Toy Insider senior editor James Zahn speaks with Asking for a Trend's Julie Hyman about the progress of AI use in the toy industry, the opportunity this partnership presents for Mattel, and regulators' concerns around children's exposure to AI. To watch more expert insights and analysis on the latest market action, check out more Asking for a Trend here. Mattel, the maker of Barbie dolls and Hot Wheels cars is signing a deal with OpenAI to use its artificial intelligence tools to design its toys. For more on what that means for the industry, we're bringing in James Zahn, editor in chief at the Toy Book and senior editor at the Toy Insider. James, good to see you. Um, and when I saw this news immediately I thought of you because I was curious to get your take on what this means and if this is going to be sort of the new normal for the toy industry. Hello, thanks for thinking of me with this. And yeah, AI has been a hot topic within the toy industry now for about three or four years. Mattel started dabbling in it a few years ago for some packaging and things. They were using the Adobe suite of products at the time, but the OpenAI deal certainly raised a few eyebrows yesterday morning. And so, you know, have we seen in your view a successful marriage in any of the toy makers, either using generative AI to develop toys, or the toys sort of successfully incorporating AI elements? So I think you've probably seen some stuff that has used AI in the creative process and it just hasn't been out there as an advertised sort of thing. As far as a successful marriage on the consumer front, uh, in 2023 or so we saw a first wave, if you will, of AI enabled toys and those did not do very well. But what I think's happened now is that the technology has advanced so quickly and it's still, it's advancing as we're having this conversation. It continues to move. I think that the deal with OpenAI really signals a huge leap forward for Mattel because the first major toy maker to sort of crack the code with incorporating AI not just in the development of their products, and when we think about play, not just toys and games, but the experience of play and what that could mean, it's it's all being reinvented. Whoever cracks that first, and maybe it's going to be Mattel here, they're going to be hailed as a pioneer because AI is not going away. It's here to stay. We need to learn to use it. So, you know, I don't know if our our puny human brains can can imagine, but like what are some possibilities of how we could see this play out? Like is it going to mean, you know, toy, the playing and toys are radically reinvented, does it mean new features, what should we be looking for? I have a variety of takes on this. Uh, first, think about your core toys. Can Barbie talk to He-Man? Can Skeletor go out there and have an adventure with Polly Pocket and converse with them, not only themselves, but with the child, and can they do that in a safe manner? Can you have a Magic 8-Ball and instead of those few stock answers, can it do something that's more personalized? Uh, can you take a game like Uno and incorporate an AI player into it? There's a lot of potential and I also think too beyond the typical toys, games and experiences. There's also the live entertainment element like the LBE, the location-based experience. Can that somehow merge with the physical play experiences? And I think that's what we're going to see going forward because there's a lot of technology that the consumers don't really know about yet and it's moving so quickly. So I I have a really strong feeling that OpenAI and Mattel have something up their sleeves that they're not telling us yet. Oh, interesting. I don't know if it's Skeletor talking to Polly Pocket, but I eagerly await that day. Um, you sort of touched on this and that is the safety element, of course, right? Where you know, a lot of different states as well as on the federal level, they're trying to figure out how to regulate all of this, but it's really sensitive when it comes to kids, right? So, um, you know, there's obviously also potential safety issues if you've got these toys interacting with kids and you've got artificial intelligence. So, you know, I'm sure there are concerns in the industry and there's awareness and sensitivity to that issue. Absolutely. There are a ton of concerns and a bunch of regulations and then of course there are new regulations that are going to have to be made because AI is sort of, as we love to say the wild west of the moment. And a few years ago, and if you back it up, maybe even a decade ago when the first Bluetooth enabled toys and Wi-Fi enabled toys came on board. Uh, there were concerns there. There were some security holes, some folks got into some trouble because of that and they had to go back to the drawing board. I expect AI is going to have that too, because some of the some of the toys we played with in 2023, when they were really just testing the market and these weren't major toy makers. They were sort of the mid-tier, was testing the waters. There were a few that seemed very GPT driven and that sort of opened up some uh, icky possibilities, I guess you could say. But because we're talking about such a reputable company that has an 80-year legacy, which is Mattel, I really doubt that they're going to put their name on something that's not well thought, and some of the folks that are involved with this, you know, have a really strong track record. Right. Right. And a strong motivation to not screw it up. James, it's great to see you, have a good weekend. Absolutely. You too. Thank you. Sign in to access your portfolio
