RMD stock was upgraded on January 30, 2022, to a Buy rating by Goldman Sachs. The upgrade comes just days after the company reported EPS and revenue misses.
ResMed upgraded to Buy from Neutral at Goldman Sachs
Goldman Sachs analyst Chris Cooper upgraded ResMed to Buy from Neutral with a price target of A$35.80, down from A$37.20. Cooper understands some push-back on ResMed’s premium valuation is warranted. However, contrary to certain other corners of the sector/market, the analyst notes that ResMed is highly profitable, strongly cash-generative and has a robust balance sheet. Cooper says it has a stronger competitive position than across most of its history, faces industry-wide price tailwinds, and is also successfully sharing its own cost growth with customers. The analyst also points out that relative to growth, ResMed is the cheapest large HC manufacturer on the ASX, and has materially de-rated relative to the market since mid-September, affording the best entry point since announcement of the recall.
ResMed price target lowered to $280 from $300 at Baird
On January 28, 2022, Baird analyst Mike Polark lowered the firm’s price target on ResMed to $280 from $300 and keeps an Outperform rating on the shares. The analyst still likes his recent upgrade and believe positive is the right call for 2022 and potentially beyond on the competitor’s unprecedented recall event.
ResMed Inc. Announces Results for the Second Quarter of Fiscal Year 2022
On January 27, 2022, ResMed Inc. (NYSE: RMD, ASX: RMD) today announced results for its quarter ended December 31, 2021. ResMed reported Q2 EPS of $1.47 versus the consensus estimate of $1.52. The company reported Q2 revenue of $894.9M versus the consensus estimate of $935.25M.
Second Quarter 2022 Highlights
- Revenue increased by 12% to $894.9 million; up 13% on a constant currency basis
- Gross margin of 56.4%; non-GAAP gross margin contracted 230 bps to 57.6%
- Income from operations increased 12%; non-GAAP operating profit up 5%
- Diluted earnings per share of $1.37; non-GAAP diluted earnings per share of $1.47
“Our second-quarter results reflect continued strong performance across our business resulting in double-digit top-line revenue growth, driven by ongoing high demand for our sleep and respiratory care products, and solid growth in our software-as-a-service business,” said Mick Farrell, ResMed CEO. “Our global ResMed team continues to find ways to deliver products and solutions to our customers, even amid ongoing supply chain challenges that have limited additional access to critical electronic components. We are working every day to meet the extraordinary demand generated by our competitor’s ongoing device recall. We continue to ensure priority for the highest-need patients first, and we are working with physicians, providers, and healthcare systems to maintain delivery of medical devices and digital health solutions for the patients who need care.” “Despite constantly evolving market dynamics, we remain focused on our goal to improve 250 million lives in the year 2025; supporting patients with the sleep apnea therapy, respiratory care therapy, and digital health solutions they need as we deliver value for all of our customers. We are investing in medical device research and development, as well as digital health innovation that will unlock value across the healthcare system. I am incredibly proud of our global ResMed team, working around the clock with providers and physicians across 140 countries to get products directly into the hands of patients who most need our help.”
ResMed upgraded to Overweight at JPMorgan ahead of ‘year of opportunity’
On January 24, 2022, JPMorgan analyst David Low upgraded ResMed (RMD) to Overweight from Neutral with a price target of $270, up from $260, calling 2022 “a year of opportunity” for the company as he expects it to take “full advantage” of competitor Philips’ (PHG) recall. While acknowledging that Philips will work hard to recover share once the recall has been dealt with, he is confident that ResMed has “both the product range and sales force to ensure it holds onto material share gains,” Low tells investors.
ResMed upgraded to Outperform from Neutral at Baird
On January 13, 2022, Baird analyst Mike Polark upgraded ResMed (RMD) to Outperform from Neutral with a price target of $300, up from $270. After Philips’ update yesterday, he is now comfortable suggesting a benefit from Philips’ recall could be bigger than currently guided and have a value longer and higher than previously envisioned, Polark tells investors. For the company’s upcoming report and March quarter Polark said he is “not expecting heroics,” but he thinks they should be “fine versus expectations with great optics,” adding that ResMed’s June quarter “could be more exciting.”
📺 ResMed Update on Supply Chain Challenges: December 2021
📉 RMD Stock Technical Analysis
Large players trading volume has turned around and is starting to rise; however, both the long and short-term trends are negative. It is better to avoid buying stocks with negative trends. RMD is currently trading in the middle of its 52-week range. This is in line with the S&P500 Index, which is also trading in the middle of its range. RMD is part of the Health Care Equipment & Supplies industry. There are 216 other stocks in this industry. RMD outperforms 81% of them. Prices have been falling strongly lately, it is better to avoid new long positions here. Volume is considerably higher in the last couple of days. In combination with the strong move down this is a bad signal.
There is a support zone ranging from 214.58 to 216.11. This zone is formed by a combination of multiple trend lines in multiple time frames.
There is a resistance zone ranging from 235.01 to 240.94. There is also a resistance zone ranging from 247.59 to 252.08. These zones are formed by a combination of multiple trend lines and important moving averages in multiple time frames. Finally, there is a resistance zone ranging from 267.38 to 268.66. This zone is formed by a combination of multiple trend lines in the daily time frame.
The technical rating of RMD is bad and it also does not present a quality setup at the moment. RMD stock has a Setup Rating of 1 out of 10. Prices have been extended to the downside lately. For a nice entry it is better to wait for a consolidation. Click here to sign up for email alerts on when RMD stock consolidates and has a Setup Rating of 8 or higher.