Deutsche Bank Sounds Alarm on Intuitive Surgical Stock (ISRG) with a Rare ‘Sell’ Rating

Intuitive Surgical (ISRG) came under pressure after Deutsche Bank issued a rare Sell rating on the stock. Going against the broader consensus, analyst Imron Zafar cut his rating on Intuitive Surgical stock from Hold to Sell. He also slashed his price target from $515 to $440, predicting a downside of over 16% from current levels. While the stock remains a leader in robotic surgery, investors may need to reassess near-term risks following the downgrade. Meanwhile, ISRG stock declined by over 5% on Monday.

Deutsche Bank Turns Bearish on ISRG Stock

Intuitive Surgical has maintained a near-monopoly in soft-tissue surgical tools since the FDA approved its da Vinci robotic system in 2000. However, Zafar warned that this dominance may come under pressure in the coming years as lower-cost remanufactured instruments enter the market, potentially eroding the company’s competitive moat. For context, the da Vinci Surgical System is a robotic-assisted platform designed for minimally invasive procedures.

Notably, Deutsche Bank flagged growing competition from remanufactured tools and rival robotic systems from Medtronic (MDT) and Johnson & Johnson (JNJ) as a key risk for Intuitive Surgical. While the da Vinci system remains strong, Zafar warned that a move toward cheaper alternatives could pressure the company’s revenue and margins over time. He further pointed out that the da Vinci system is used in over three million procedures annually by more than 50,000 surgeons. With instruments and accessories making up over 60% of its revenue, Deutsche Bank estimates that remanufactured tools could erode 10% to 15% of U.S. sales in this segment by 2028.

RBC Reaffirms Buy Rating

On the other hand, Shagun Singh of RBC Capital challenged Deutsche Bank’s bearish view in a separate note on Monday, suggesting that the recent drop in ISRG’s stock presents a “buying opportunity” for investors.

According to Singh, RBC had already factored in the rise of remanufactured instruments, and many users are expected to upgrade to Intuitive’s next-gen systems instead of relying on older, refurbished tools. RBC maintains a Buy rating on the stock with a price target of $605.

Is ISRG Stock a Buy, Sell, or Hold?

According to TipRanks, ISRG stock has received a Strong Buy consensus rating, with 18 Buys, two Holds, and one Sell assigned in the last three months. The average Intuitive Surgical stock price target is $593.0, suggesting a potential upside of 12.7% from the current level.

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