Before you read on, please be aware that the analysis below is my opinion only and may include flawed assumptions and inaccuracy of logic; therefore, caveat emptor applies here. Furthermore, all emphasis (color-coded, boldness, and underlined) on the excerpts are my own.
Anyone wants to venture a guess of what I meant by “the speed of time”?
Yep, I’m talking about the wrap of time created by the Da Vinci in our current space/time continuum.
Haha! Sorry folks! I couldn’t resist it. In plain English, I’m talking about the seventeen years of hard work by Intuitive Surgical Inc in paving the road for the medical community to embrace robotically assisted surgical device (RASD). In other words, the die is cast. It is my 2 cents that RASD is accepted as the necessary medical wonder to be utilized for the benefit of mankind. Hence, the surgeons who dislike the way the Da Vinci operated (e.g., octopus arms tethered to single platform hovering over the patient, lack of haptic feedback, etc.) might be yelling, “Hallelujah!” when Senhance was cleared by the FDA late last year.
Why do you say that?
Well, look what I found. Take a look at the excerpt below from the article, “Technical review of the da Vinci surgical telemanipulator.”
Published technical literature on the da Vinci system highlight strengths and weaknesses of the robot design. While the system facilitates complex surgical operations and has a low malfunction rate, the lack of haptic (especially tactile) feedback and collisions between the robotic arms remain the major limitations of the system. Accurate, preplanned positioning of access ports is essential.
Two significant limitations of the Da Vinci system have been identified by this technical review:
- Lack of haptic (especially tactile) feedback
- collisions between the robotic arms
Lack of haptic is nothing new here, and that is why we love the Senhance; but the collisions between the robotic arms, while not truly surprising, is a compelling piece of information. Don’t you think?
This new piece of information, per the excerpt, seemed to imply the necessity to spend the time to pre-planned an accurate arm positions to avoid potential collisions. Giving the fact that the arms are all tethered to the single platform, this could be quite a challenging task.
Even as a layman, I can see the impossibility of getting arms collision with the Senhance because each independent arms are placed away from each other as well as away from the patient. All thanks to the flexibility and versatility of the independent arms placement.
The technical review report was first published in November 2012. As of today, the Da Vinci still has no haptic feedback, and the arms are still tethered to a single platform; therefore, I’m going to speculate that there is a lot of pent-up demand for the Senhance RASD from the surgeons who wanted something different from the Da Vinci.
This pent-up demand has the potential to speed up the acceptance rate in Senhance. The fact that two large medical institutions with financial clout expedited the CapEx (capital expenditure) process to purchase the Senhance earlier than four to six quarters could be the “sign” that there could be more U.S. purchase coming sooner than expected.
Technically speaking, the chart is very bullish! While price moved a whopping 43% for the week, it is my 2 cents that the move is far from over. There are simply too many catalysts (press release on the 2nd U.S. buyer, FDA approval for additional indications, and more U.S. and international buyers) waiting to be released in near terms. If the catalysts are all positive, it may paint a clearer picture of imminent adoption. Once the collective mind decides adoption is happening, then it is probably safe to say that price will just keep on climbing steadily going forward with some profit-taking dips along the way.
What about valuation getting ahead of itself?
I believe (aka my 2 cents) when the collective mind decides adoption is imminent, it will go the route of Amazon, Tesla, and quite a few biotech companies (e.g. $EDIT). Investors may be willing to pay a premium to buy into a position when the probability of success is quite high. By then, demand and supply of the stock will determine the price action since the fundamental of future growth is baked into the price.
In summary, it’s my humble opinion that the speed of acceptance for Senhance is going to be much faster than when Da Vinci started out. For that to happen, there must be a pent-up demand for Senhance RASD. Giving the bulk of laparoscopic surgeons have yet to try a RASD, it is conceivable that Senhance may be THE RASD to crack the resistance and release the pent-up demand for Senhance. When that happens, I believe we can count on witnessing the change in the SPEED of TIME.
Don’t forget; all the above are my opinions only!
Good Luck and may fortune blesses all TRXC investors.
My 2 cents.
From my camera: