Healthcare Business

Trump Corporate Tax Cuts Could Really Help These 4 Large Cap Companies

Lee Jackson

Intuitive Surgical

This company has been a momentum trader’s dream over the past few years. Intuitive Surgical Inc. (NASDAQ: ISRG) designs, manufactures and markets da Vinci surgical systems and related instruments and accessories. Its da Vinci surgical system translates a surgeon’s natural hand movements, which are performed on instrument controls at a console into corresponding micro-movements of instruments positioned inside the patient through small incisions or ports.

The company’s da Vinci surgical system include surgeon’s consoles, patient-side carts, 3-D vision systems, da Vinci skills simulators and Firefly fluorescence imaging products that enable surgeons to perform various surgical procedures, including gynecologic, urologic, general, cardiothoracic, and head and neck surgical procedures.

One of the biggest reasons Intuitive Surgical stock has jumped almost 90% since its 2014 lows is because of its success in hernia operations. While robotic assistance for that operation still seems to have a lot of room to grow, it’s important to remember that the market is a forward-looking machine. In addition, there are other procedures where the da Vinci robotic surgical system could add value, and the company has delighted investors with huge profit growth.

The consensus price target for Intuitive Surgical is posted at $756.79. The stock closed yesterday at $640.55.

Zimmer Biomet

This was a huge 2015 merger that Wall Street has been positive on from the get-go. Zimmer Biomet Holdings Inc. (NYSE: ZBH) is a global leader in musculoskeletal health care. The company designs, manufactures and markets orthopaedic reconstructive products; sports medicine, biologics, extremities and trauma products; spine, bone healing, cranio maxillofacial and thoracic products; dental implants; and related surgical products.

The company reported weak third-quarter results, and top analysts chalk that up to what they termed as “unforeseen supply issues.” Management lowered guidance, and at this point it remains unclear exactly how far into 2017 these supply issues will linger, which brings us to question if double-digit earnings-per-share growth is a reasonable goal.

The $132.24 consensus price objective is much higher than where shares closed yesterday, at $101.45.

While the actual specifics of a lower corporate tax rate are still up in the air, the fact of the matter is there will be one. These companies are offering investors with a more aggressive stance an outstanding entry point.