The Robot Revolution Hasn’t Been Derailed by the Rise of AI

AI has been the market’s hottest trend for over two years. It’s still in its early stages, with more room to run. More importantly, it hasn’t derailed other parts of the tech trend either.

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  • That includes robotics, which, combined with AI software, can allow for a revolution in reducing human physical labor. Robots can perform the same routine tasks for hours on end without a break. Or do more complicated work.

    That’s where a company like Intuitive Surgical (ISRG) comes into play.

    The medical technology company’s robots can be used to handle delicate surgeries. Already one of the great stocks of the past decade, Intuitive’s most recent earnings beat expectations.

    Even after running up 50% over the past year, Intuitive has more room to run. Earnings grew by 35%, and profit margins are just under 30%, all impressive metrics and the sign of a strong growth play.

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  • Action to take: Momentum investors may like shares here. Shares are pricey at 70 times forward earnings, so value investors may want to look elsewhere.

    For traders, shares just spiked to new all-time highs on the earnings beat. That trend higher will likely continue. The March $620 calls, last trading for about $11.50, could see mid-double-digit returns on a further rally into next quarter’s earnings season.

     

    Disclosure: The author of this article has no position in the company mentioned here, but may trade after the next 72 hours. The author receives no compensation from any company mentioned in this article.

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