ResMed initiated with an Outperform at Baird

Baird initiated coverage of ResMed with an Outperform rating and $280 price target. The company is positioned to benefit from rising penetration in the multi-billion dollar CPAP market, the analyst tells investors in a research note. The firm thinks ResMed should deliver mid- to high-single digit revenue and up to mid-teens earnings growth ahead as rising obstructive sleep apnea prevalence drives device growth and recurring growth revenue streams. While weight loss drug risks remain, the company’s near-to-intermediate earnings upside potential should help ResMed maintain its premium multiple, contends Baird.