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Resmed
(NYSE:RMD)
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Rating:73Outperform
Price Target:
$238.00
â–²(4.33% Upside)
Action:Reiterated
Date:05/01/26
The score is driven by strong underlying financial performance (high margins, low leverage, solid cash generation) and a constructive earnings update with reiterated guidance and strong execution. This is partially offset by weak technical signals (downtrend and negative momentum) and only moderate valuation support.
Positive Factors
High profitability and margin profile
Sustained high gross and net margins indicate durable pricing power and product mix advantages in sleep/respiratory devices. Elevated margins support reinvestment, R&D, dividends and buybacks, and provide a buffer against cost shocks while enabling long-term margin-accretion targets through 2030.
Negative Factors
RCS (Residential Care Software) underperformance
Underperformance in the RCS vertical impairs a key part of ResMed's strategy to expand software recurring revenue and higher-margin services. Persistent weakness in senior living/long‑term care could slow overall margin expansion and reduce the anticipated recurring revenue runway absent successful portfolio fixes.
Read all positive and negative factors
Positive Factors
Negative Factors
High profitability and margin profile
Sustained high gross and net margins indicate durable pricing power and product mix advantages in sleep/respiratory devices. Elevated margins support reinvestment, R&D, dividends and buybacks, and provide a buffer against cost shocks while enabling long-term margin-accretion targets through 2030.
Read all positive factors
Resmed Key Performance Indicators (KPIs)
Any
Revenue by Segment
Breaks down overall revenue into specific business segments, providing insight into which parts of the company are performing well and contributing most to the bottom line.
Breaks down overall revenue into specific business segments, providing insight into which parts of the company are performing well and contributing most to the bottom line.
Data provided by:
The Fly
The FlyResmed (RMD) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$30.41B
Dividend Yield0.92%
Average Volume (3M)1.53M
Price to Earnings (P/E)20.2
Beta (1Y)0.56
Revenue Growth10.28%
EPS Growth16.40%
CountryUS
Employees9,980
SectorHealthcare
Sector Strength45
IndustryMedical - Devices
Share Statistics
EPS (TTM)10.38
Shares Outstanding145,056,380
10 Day Avg. Volume1,515,784
30 Day Avg. Volume1,532,202
Financial Highlights & Ratios
PEG Ratio0.72
Price to Book (P/B)6.34
Price to Sales (P/S)7.36
P/FCF Ratio22.78
Enterprise Value/Market Cap0.86
Enterprise Value/Revenue4.73
Enterprise Value/Gross Profit7.67
Enterprise Value/Ebitda11.99
Forecast
1Y Price Target
$256.09Price Target Upside12.26% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering14
EPS Forecast (FY)12.23
Revenue Forecast (FY)$6.08B
Resmed Business Overview & Revenue Model
Company Description
ResMed Inc. is a leading global medical technology enterprise engaged in the creation, production, distribution, and marketing of healthcare devices and connected digital solutions. The company operates through two primary segments: Sleep and Resp...
How the Company Makes Money
ResMed makes money primarily by selling sleep and respiratory care products and by providing software-as-a-service (SaaS) and related digital health services.
1) Device and mask/accessory sales (core revenue stream):
- Flow generators and ventila...
Resmed Earnings Call Summary
Earnings Call Date:Apr 30, 2026
(Q3-2026)
| % Change Since: |
Next Earnings Date:Aug 06, 2026
Earnings Call Sentiment Positive
The call presented a broadly positive operational and financial picture: durable revenue growth (11% headline, 8% constant), material gross margin expansion (+290 bps YoY), double‑digit EPS growth (~21%), strong free cash flow and capital returns, successful product rollouts (fabric masks, AirSense 11) and large real‑world evidence supporting a GLP‑1 demand tailwind. Management acknowledged and is actively managing a set of medium‑term headwinds — including rising SG&A and R&D investments, isolated investment write‑downs, RCS vertical challenges, component cost pressures, and near‑term acquisition dilution — but positioned these as manageable given a strong balance sheet, ongoing supply chain productivity initiatives, and targeted M&A.Positive Updates
Revenue Growth
Group revenue of $1.43 billion, up 11% on a headline basis and 8% on a constant currency basis versus prior year.
Negative Updates
Residential Care Software (RCS) Underperformance
RCS revenue only grew 4% on a constant currency basis; management called out ongoing challenges in senior living and long‑term care verticals and noted continued portfolio optimization work to return RCS to higher growth and margin profiles by FY27.
Read all updates
Q3-2026 Updates
Positive
Negative
Revenue Growth
Group revenue of $1.43 billion, up 11% on a headline basis and 8% on a constant currency basis versus prior year.
Read all positive updates
Company Guidance
Management reiterated fiscal‑2026 and longer‑term guidance, saying gross margin should be about 62–63% for FY26 (with a plan for ongoing gross‑margin accretion through 2030 via double‑digit bps improvement/year), SG&A of 19–20% of revenue and R&D of 6–7% of revenue for FY26, an effective tax rate of 21–23% for FY26, and Q4 net interest income of roughly $15M (including ~$9M/quarter from a Singapore‑USD hedge); they expect to close the $340M Noctrix deal ~June 1, 2026 (Noctrix run‑rate ≈ $24M/year and ~$(0.02) non‑GAAP EPS impact in Q4), will repurchase at least $175M of shares in 2026 (Q3 buybacks were $175M; total shareholder returns in Q3 were $262M) and declared a $0.60/share quarterly dividend, and reaffirmed a five‑year outlook of high single‑digit revenue growth with earnings growth outpacing revenue.Resmed Financial Statement Overview
Summary
Income Statement
90
Very Positive
Balance Sheet
88
Very Positive
Cash Flow
84
Very Positive
| Breakdown | TTM | Jun 2025 | Jun 2024 | Jun 2023 | Jun 2022 | Jun 2021 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 5.54B | 5.15B | 4.69B | 4.22B | 3.58B | 3.20B |
| Gross Profit | 3.42B | 3.05B | 2.66B | 2.36B | 2.02B | 1.84B |
| EBITDA | 2.19B | 1.91B | 1.53B | 1.36B | 1.18B | 1.10B |
| Net Income | 1.52B | 1.40B | 1.02B | 897.56M | 779.44M | 474.50M |
Balance Sheet | ||||||
| Total Assets | 8.78B | 8.17B | 6.87B | 6.75B | 5.10B | 4.73B |
| Cash, Cash Equivalents and Short-Term Investments | 1.66B | 1.21B | 238.36M | 227.89M | 273.71M | 295.28M |
| Total Debt | 843.17M | 851.81M | 873.93M | 1.58B | 917.55M | 793.72M |
| Total Liabilities | 2.29B | 2.21B | 2.01B | 2.62B | 1.74B | 1.84B |
| Stockholders Equity | 6.49B | 5.97B | 4.86B | 4.13B | 3.36B | 2.89B |
Cash Flow | ||||||
| Free Cash Flow | 1.75B | 1.66B | 1.29B | 559.30M | 195.11M | 619.89M |
| Operating Cash Flow | 1.89B | 1.75B | 1.40B | 693.30M | 351.15M | 736.72M |
| Investing Cash Flow | -295.26M | -200.04M | -269.78M | -1.16B | -229.92M | -158.46M |
| Financing Cash Flow | -907.75M | -606.25M | -1.12B | 422.87M | -128.36M | -764.63M |
Resmed Technical Analysis
Neutral
228.12
Price Trends
201.51
Positive
220.21
Negative
238.09
Negative
Market Momentum
0.15
Negative
62.43
Neutral
81.15
Negative
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For RMD, the sentiment is Neutral. The current price of 228.12 is above the 20-day moving average (MA) of 195.10, above the 50-day MA of 201.51, and below the 200-day MA of 238.09, indicating a neutral trend. The MACD of 0.15 indicates Negative momentum. The RSI at 62.43 is Neutral, neither overbought nor oversold. The STOCH value of 81.15 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for RMD.
Resmed Risk Analysis
Resmed disclosed 38 risk factors in its most recent earnings report. Resmed reported the most risks in the "Legal & Regulatory" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Resmed Peers Comparison
UnderperformOutperform
Sector (51)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
79 Outperform | $25.84B | 48.64 | 17.87% | 0.32% | 11.24% | 17.11% | |
73 Outperform | $30.41B | 20.20 | 24.41% | 0.92% | 10.28% | 16.40% | |
64 Neutral | $43.56B | 40.02 | 4.54% | 2.13% | 2.39% | -24.85% | |
51 Neutral | $7.86B | -0.30 | -43.30% | 2.27% | 22.53% | -2.21% | |
49 Neutral | $11.70B | -10.79 | -16.43% | 2.75% | -4.79% | -78.01% |
* Healthcare Sector Average
RMD
Resmed
209.63
-44.29
-17.44%
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WST
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Resmed Corporate Events
Business Operations and StrategyFinancial Disclosures
ResMed Delivers Strong Q3 Results and Margin Expansion
Positive
Apr 30, 2026
On April 30, 2026, Resmed reported third-quarter fiscal 2026 results for the period ended March 31, 2026, posting an 11% year-on-year revenue increase to $1.43 billion, or 8% in constant currency, alongside a 290-basis-point expansion in gross mar...
Business Operations and StrategyExecutive/Board ChangesFinancial Disclosures
ResMed Announces CFO Transition and Confirms Growth Strategy
Positive
Apr 30, 2026
On April 30, 2026, Resmed announced that long-serving Chief Financial Officer Brett Sandercock will retire as CFO on May 4, 2026, after 27 years at the company and 20 years in the finance chief role, and will remain a special advisor to CEO Mick F...
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.