Intuitive Surgical Inc. (NASDAQ:ISRG)

The valuation ratios exhibit varied trends over the observed period, spanning from March 2022 to December 2025. Generally, the ratios demonstrate increased volatility in the latter half of the period, particularly from March 2024 onwards. An overall trend of increasing valuations is apparent through much of 2023 and early 2024, followed by a moderation in the most recent quarters.

Price to Earnings (P/E)

The P/E ratio experienced a notable increase from 55.10 in March 2022 to a peak of 79.78 in June 2023. Subsequently, it decreased to 61.96 in September 2023 before rising again to 87.82 by December 2024. The ratio concludes the period at 59.55 in December 2025, representing a return towards levels observed earlier in the timeframe. This suggests fluctuating investor confidence in earnings potential.

Price to Operating Profit (P/OP)

Similar to the P/E ratio, P/OP generally increased from 49.98 in March 2022 to 70.08 in June 2023. It then exhibited a decline to 55.63 in September 2023, followed by another increase to 86.83 in December 2024. The ratio finished the period at 57.74 in December 2025, mirroring the trend observed in the P/E ratio and indicating a correlation between earnings and operating profit valuations.

Price to Sales (P/S)

The P/S ratio demonstrated a consistent upward trend from 12.69 in June 2022 to a high of 24.42 in December 2024. Prior to this, it fluctuated between 12.62 and 18.71. The ratio decreased to 16.90 in December 2025, suggesting a potential correction or shift in investor focus from revenue growth to profitability. This ratio experienced the most substantial increase overall.

Price to Book Value (P/BV)

The P/BV ratio showed a steady increase from 6.29 in June 2022 to a peak of 12.41 in December 2024. It began at 7.48 in March 2022. The ratio concluded the period at 9.54 in December 2025, indicating a decrease from its highest point but remaining elevated compared to earlier values. This suggests increasing investor confidence in the company’s asset value, followed by a slight reassessment.

In summary, the observed ratios generally increased through 2023 and into early 2024, indicating rising valuations. The latter part of the period shows some moderation in these ratios, potentially reflecting a recalibration of market expectations or a shift in investment sentiment. The P/S ratio exhibited the most pronounced increase, while all ratios demonstrated increased fluctuation in the most recent quarters.

The price-to-earnings (P/E) ratio exhibited considerable fluctuation over the observed period, spanning from March 31, 2022, to December 31, 2025. Initial values indicated a relatively stable range, followed by a period of increasing volatility and a concluding trend towards moderation.

Initial Period (Mar 31, 2022 – Dec 31, 2022)

The P/E ratio began at 55.10 and demonstrated moderate variability, ranging from a low of 52.74 to a high of 64.99. This suggests a generally consistent investor valuation of earnings during this timeframe, with some quarter-to-quarter adjustments.

Ascending Phase (Mar 31, 2023 – Dec 31, 2023)

A notable increase in the P/E ratio occurred, rising from 79.43 to peak at 87.82. This coincided with increasing earnings per share (EPS), but the P/E ratio’s growth indicates investors were willing to pay a progressively higher premium for each dollar of earnings. The ratio reached its highest point in the observed period during this phase.

Subsequent Moderation (Mar 31, 2024 – Dec 31, 2025)

Following the peak, the P/E ratio experienced a downward trend, decreasing from 87.82 to 59.55. While EPS continued to rise, the decline in the P/E ratio suggests a recalibration of investor expectations, potentially reflecting increased confidence in future earnings or a shift in market sentiment. The ratio stabilized towards the end of the period, indicating a potential leveling off of valuation adjustments.

Correlation with Earnings Per Share

The P/E ratio generally moved in conjunction with EPS, although the magnitude of change differed. Periods of increasing EPS were often accompanied by increases in the P/E ratio, but the reverse was not always true. The ratio’s decline in the latter part of the period, despite continued EPS growth, suggests that factors beyond earnings were influencing investor valuation.

Overall, the P/E ratio demonstrated a dynamic pattern, initially stable, then exhibiting a period of expansion, and finally moderating. This suggests evolving investor sentiment and a complex interplay between earnings performance and market expectations.

The Price to Operating Profit (P/OP) ratio exhibits considerable fluctuation over the observed period, spanning from March 31, 2022, to December 31, 2025. An initial decline is followed by a period of expansion, then contraction, and finally, a renewed decline. The ratio generally trends upward throughout the period, but with significant quarterly volatility.

Initial Decline and Recovery (Mar 31, 2022 – Dec 31, 2022)

The P/OP ratio began at 49.98 in March 2022, decreased to 44.54 by June 2022, and then showed a modest recovery to 46.65 in September 2022. A more substantial increase was observed by December 2022, reaching 54.49. This initial period suggests potential market reassessment followed by a partial correction.

Expansionary Phase (Mar 31, 2023 – Jun 30, 2023)

The ratio continued its upward trajectory in the first half of 2023, increasing from 66.95 in March to 70.08 in June. This expansion indicates increasing investor confidence relative to operating profitability during this period.

Contraction and Volatility (Sep 30, 2023 – Mar 31, 2024)

A significant contraction occurred in September 2023, with the P/OP ratio falling to 55.63. This was followed by a substantial increase to 75.42 in December 2023, and further to 82.80 in March 2024. This period demonstrates heightened volatility and potentially reflects significant shifts in market expectations.

Peak and Subsequent Decline (Jun 30, 2024 – Dec 31, 2025)

The P/OP ratio peaked at 89.92 in June 2024, before declining to 86.83 in September 2024. The downward trend continued through December 2025, reaching 57.74. This suggests a potential correction or a shift in investor sentiment regarding the company’s future operating profitability.

Overall, the P/OP ratio demonstrates a complex pattern. While a general upward trend is observable over the entire period, it is punctuated by periods of significant volatility and a clear decline in the latter quarters. The ratio’s fluctuations suggest sensitivity to market conditions and evolving perceptions of the company’s operating performance.

The Price to Sales (P/S) ratio for the observed period demonstrates considerable fluctuation. Initially, the ratio decreased from 15.34 to 12.69 between March 31, 2022, and June 30, 2022, followed by a period of relative stability through December 31, 2022. A subsequent increase was noted, peaking at 18.71 by December 31, 2022, before declining again.

Initial Decline (Q1-Q2 2022)

The initial decrease in the P/S ratio coincided with a decrease in the share price, while sales per share remained relatively stable. This suggests the market may have adjusted expectations downwards during this period.

Volatility and Peak (Q3 2022 - Q4 2023)

From September 30, 2022, through December 31, 2023, the P/S ratio exhibited significant volatility. The ratio increased to 21.35 by June 30, 2023, driven by a substantial increase in share price alongside growth in sales per share. However, a subsequent decline in the share price during the third quarter of 2023 partially offset this increase, bringing the ratio down to 13.72. The ratio then rose again to 24.42 by December 31, 2023, indicating renewed investor optimism.

Recent Trend (2024-2025)

The most recent period, from March 31, 2024, through December 31, 2025, shows a general downward trend in the P/S ratio, decreasing from 21.35 to 16.90. This decline occurred despite continued growth in sales per share, suggesting the share price did not increase at the same rate, or potentially decreased, leading to a lower valuation relative to sales. The rate of decline appears to be moderating towards the end of the observed period.

Correlation with Share Price and Sales per Share

The P/S ratio appears strongly correlated with the share price. Increases in the share price generally lead to increases in the P/S ratio, and vice versa. Sales per share also plays a role, but its impact is less pronounced than that of the share price. Periods of simultaneous increases in both share price and sales per share result in the most significant increases in the P/S ratio.

Overall, the P/S ratio demonstrates a dynamic relationship with both share price and sales per share, reflecting changing market sentiment and investor expectations. The observed fluctuations suggest the company’s valuation is sensitive to shifts in these underlying factors.

The price-to-book value (P/BV) ratio for the analyzed period demonstrates a generally increasing trend, punctuated by periods of fluctuation. Initial values indicate a ratio around 7.5, followed by a decline, then a sustained increase over the subsequent quarters.

Initial Period (Mar 31, 2022 – Dec 31, 2022)

The P/BV ratio began at 7.48 and experienced a decrease to 6.29 before modestly recovering to 7.78 by the end of 2022. This initial period suggests a degree of market uncertainty or a reassessment of the company’s value relative to its book value.

Ascending Trend (Mar 31, 2023 – Dec 31, 2023)

From March 2023 through December 2023, the P/BV ratio exhibited a consistent upward trajectory, rising from 9.29 to reach a peak of 10.01 in December 2023. This increase coincided with a rise in both share price and book value per share, indicating positive market sentiment and potentially improved investor confidence.

Peak and Subsequent Adjustment (Mar 31, 2024 – Dec 31, 2025)

The ratio continued to climb, peaking at 12.41 in December 2024. Following this peak, a slight decline was observed, with the ratio ending the analyzed period at 9.54 in December 2025. This suggests a potential correction or stabilization after a period of significant growth. The book value per share also showed consistent growth throughout this period, contributing to the elevated P/BV ratios.

Book Value Per Share Trend

Book value per share consistently increased throughout the analyzed period, moving from $33.72 in March 2022 to $50.19 in December 2025. This steady growth in book value supports the overall increase in the P/BV ratio, although the price component experienced more volatility.

Overall Observation

The P/BV ratio generally increased over the analyzed timeframe, indicating that the market was willing to pay a higher premium for each dollar of the company’s book value. The fluctuations suggest sensitivity to market conditions and investor perceptions. The recent slight decline from the peak warrants further investigation to determine if it represents a temporary correction or the beginning of a more substantial trend.