Intuitive Surgical Set to Drop 13%

The stock market wound up having a good day yesterday as the S&P 500 closed at 1,640.46, its highest close since June 18th. The index has now rallied for seven of the last nine sessions.

The market got more good news when Alcoa posted good earnings after the close. Alcoa is traditionally the first Dow stock to report earnings each quarter. I should add that I’m puzzled as to why Alcoa has remained in the Dow. Despite being one of the 30 Dow stocks, the company makes up about 1/250th of the index’s weighting thanks to price weighting.

Our Buy List had another very good day. We’re now up 18.88% for the year to 15.02% for the S&P 500. The change in performance has been quite dramatic. Since April 18th, we’re beating the S&P 500 by a margin of 13.16% to 6.41%. Several of our stocks like Ford ($F), Bed Bath & Beyond ($BBBY), FactSet ($FDS), Wells Fargo ($WFC) and Moog ($MOG-A) hit new highs.

The futures indicate that the market is going to open higher today. One company expected to have a rough day is Intuitive Surgical ($ISRG). The company warned that sales for Q2 will be below expectations. The pre-market trading shows ISRG down 13%, or $65 to $435 per share. Last year, I listed ISRG as one of 13 stocks to avoid. At the time, ISRG was at $558 per share. Finding over-priced stocks isn’t that hard. The problem is waiting for the market to catch up to reality.

Posted by on July 9th, 2013 at 9:08 am


The information in this blog post represents my own opinions and does not contain a recommendation for any particular security or investment. I or my affiliates may hold positions or other interests in securities mentioned in the Blog, please see my Disclaimer page for my full disclaimer.