Intuitive Surgical stock dipped Thursday after the robotic surgery behemoth said Chief Executive Gary Guthart will step down, effective July 1.
Guthart will become the executive chair of Intuitive's board of directors, the company said in a news release. He will be succeeded by Dave Rosa, the company's president. Board Chair Craig Barratt will become lead independent director.
"Having worked closely with Dave for decades, I am confident that his patients-first focus and deep capability in guiding Intuitive's strategy, our designs, our product and service quality, and our operational excellence make him uniquely qualified to lead our business forward," Guthart said in a statement.
Intuitive Surgical stock fell 1%, closing at 560.28. Shares are consolidating with a buy point at 616, according to MarketSurge. Intuitive stock remains well ahead of its moving averages.
Intuitive Surgical Stock: 15-Year CEO
Guthart has been Intuitive Surgical's chief executive since January 2010. Evercore ISI analyst Vijay Kumar called it "an incredible run for Gary Guthart."
Under his guidance, Intuitive has won clearance for the da Vinci SP and Xi surgical systems, the Ion system for invasive lung biopsies and the newest da Vinci 5. During the first quarter, Intuitive placed 147 new da Vinci 5 systems, though that slowed from 174 in the fourth quarter.
Intuitive Surgical also notched "significant expansion into international markets and enormous wealth creation for shareholders," Kumar said in a report. "While there is never an ideal time for transition, we think few would begrudge Gary for opting to step down."
Kumar kept his in-line rating on Intuitive Surgical stock. Of the 35 analysts following Intuitive on FactSet, 20 have buy or buy-equivalent ratings on shares. Kumar says the CEO transition doesn't change the key thesis on Intuitive shares.
"Dave Rosa has been with ISRG since its early years and is well versed in the company culture," he said. "Two, he has held key positions including spearheading emerging procedures, technology/scientific affairs and commercial officer roles … This broad view of the organization should set him up well to fill some big shoes."
Dave Rosa Steps In
Rosa joined Intuitive Surgical 29 years ago as its ninth employee. In the years since, he has held leadership positions across the company, including in engineering, clinical and product development, marketing, regulatory and quality affairs and the commercial organization.
The company credited him as leading the development and commercialization of the da Vinci SP and Ion robotic surgery systems.
"Dave's appointment as CEO is the culmination of the Board's thoughtful succession planning, reflecting his instrumental role in establishing our strategy, guiding the development of our product pipeline, and expanding the company's global footprint," Barratt, the board chair, said in a written statement.
Shares Rise After First-Quarter Report
Intuitive Surgical stock has trended higher this year, rising about 32% from a floor at 425 on April 7.
Shares have a Composite Rating of 94 out of a best-possible 99, according to IBD Digital. This means the stock ranks in the leading 6% of all stocks in terms of fundamental and technical measures.
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