Intuitive Surgical (ISRG) Declined Due to Management’s Cautious Commentary

ISRG +0.31%

Brown Advisory, an investment management company, released its “Brown Advisory Large-Cap Growth Strategy” third-quarter 2025 investor letter. A copy of the letter can be downloaded here. The strategy returned -0.88% (net) during the third quarter, underperforming the benchmark, the Russell 1000 Growth Index. Even though the portfolio has significant exposure to AI, its underweight to the most speculative momentum-driven parts of the trade was a headwind to performance. In addition, please check the fund’s top five holdings to know its best picks in 2025.

In its third-quarter 2025 investor letter, Brown Advisory Large-Cap Growth Strategy highlighted stocks such as Intuitive Surgical, Inc. (NASDAQ:ISRG). Intuitive Surgical, Inc. (NASDAQ:ISRG) manufactures and markets products that help physicians and healthcare providers improve the quality of and access to minimally invasive care. The one-month return of Intuitive Surgical, Inc. (NASDAQ:ISRG) was 3.49%, and its shares gained 3.23% of their value over the last 52 weeks. On December 02, 2025, Intuitive Surgical, Inc. (NASDAQ:ISRG) stock closed at $567.72 per share, with a market capitalization of $203.514 billion.

Brown Advisory Large-Cap Growth Strategy stated the following regarding Intuitive Surgical, Inc. (NASDAQ:ISRG) in its third quarter 2025 investor letter:

"Intuitive Surgical, Inc. (NASDAQ:ISRG) reported strong second-quarter results, led by procedure growth that exceeded consensus expectations and prompted a slight raise to full-year procedure guidance. System placements were in line, with U.S. placements coming in above consensus expectations. The company also lifted full-year gross margin guidance due to a lesser impact from tariffs. However, shares declined modestly as investors reacted to management’s cautious commentary on the European capital expenditure environment and additional conservatism in forward margin guidance. This conservatism contributed to the stock’s move lower during the period, despite strong procedural growth."

Intuitive Surgical, Inc. (NASDAQ:ISRG) is not on our list of 30 Most Popular Stocks Among Hedge Funds. As per our database, 99 hedge fund portfolios held Intuitive Surgical, Inc. (NASDAQ:ISRG) at the end of the third quarter, which was 107 in the previous quarter. While we acknowledge the potential of Intuitive Surgical, Inc. (NASDAQ:ISRG) as an investment, we believe certain AI stocks offer greater upside potential and carry less downside risk. If you're looking for an extremely undervalued AI stock that also stands to benefit significantly from Trump-era tariffs and the onshoring trend, see our free report on the best short-term AI stock.

In another article, we covered Intuitive Surgical, Inc. (NASDAQ:ISRG) and shared RiverPark Large Growth Fund's views on the company. In addition, please check out our hedge fund investor letters Q3 2025 page for more investor letters from hedge funds and other leading investors.

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Disclosure: None. This article is originally published at Insider Monkey.