ResMed downgraded to Neutral from Buy at UBS

UBS downgraded ResMed to Neutral from Buy with a price target of $170, down from $265. The stock is down 28% since FY23 results as the GLP-1 weight loss thesis “has now become firmly rooted in the RMD story,” the analyst tells investors. After reviewing the GLP-1 literature, the firm concludes that Eli Lilly’s (LLY) SURMOUNT-OSA trial is likely to succeed in the first half of 2024, triggering better U.S. access, and lowered its long-term sales growth rates from mid- to low- single digits for ResMed on the potential that sleep apnea patients start taking weight loss drug and create a volume headwind for ResMed’s Sleep business by the 2030s.