Following ResMed’s better than expected 1Q result, Morgans expects a strong medium-term earnings outlook will outweigh shorter-term margin pressure and supply constraints. The latter is expected to limit market share gains from the Phillips device recall.
The analyst highlights double-digit device growth and recovering patient flows though a rise in US masks of 5% was thought soft. The broker retains its Add rating and reduces its target price to $40.80 from $41.34.
Sector: Health Care Equipment & Services.
Target price is $40.80.Current Price is $35.19. Difference: $5.61 – (brackets indicate current price is over target). If RMD meets the Morgans target it will return approximately 14% (excluding dividends, fees and charges – negative figures indicate an expected loss).
