Friday, December 30, 2011

Taking Profits in Intuitive Surgical

I love this company. Intuitive Surgical (ISRG) is a true paradigm changer. It makes surgical robot systems Da Vinci, which are adopted around the world. Initially systems were almost exclusively used for prostate removal. Many analysts tried to predict Da Vinci sales based on this. They were completely wrong. FDA approves new uses of the system all the time, hospitals around the country are experimenting with even more new surgeries.
Company has all components for continues explosive growth. Da Vinci is the only robotic system which has FDA approval. Which means it has a moat, speaking in Buffett's terms. A lot of revenue comes from service and spare parts sales, which is a very stable source of income. New surgeries means new sales.
Why am I selling? First of all, I'm selling only a small part of position. Even after this sale, ISRG is the second biggest position in my portfolio. Again, I love this company. But profits are made to be taken. Discipline trumps conviction. Stock almost doubled this year. And my initial investment into company has quadrupled. Any reason is good enough, taken all together, they told me: take the profit. At least some of it.

Full disclosure: I still have significant long position in ISRG.

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