KeyBanc raises ResMed stock price target to $274

On Thursday, KeyBanc Capital Markets adjusted its financial outlook for ResMed (NYSE:RMD), a company specializing in medical equipment for treating sleep disorders. Analyst Brett Fishbin increased the price target for ResMed stock to $274.00, up from the previous target of $269.00, while maintaining an Overweight rating on the shares. Currently trading at $214.44, the company boasts a market capitalization of $31.4 billion and maintains a perfect Piotroski Score of 9, according to InvestingPro data, indicating strong financial health.

The revision comes in the wake of ResMed’s third-quarter fiscal year 2025 earnings release, which the analyst believes will be received positively by investors. The company’s revenue for the quarter surpassed expectations, primarily due to strong performance in its Masks & Accessories segment. Additionally, ResMed experienced a sequential improvement in gross margins, which further contributed to the positive assessment by KeyBanc.

Fishbin’s commentary highlighted the company’s advantageous position regarding potential tariff impacts. ResMed’s management provided insights during the earnings call that were interpreted as highly favorable for the company’s financial health. The firm anticipates minimal financial repercussions from tariffs, thanks to the continuation of historical product exemptions under the Nairobi Protocol.

The analyst’s optimistic stance is reinforced by what is described as "definitively positive commentary" from ResMed’s management regarding tariff exposure. This perspective is expected to bolster investor confidence in the company’s ability to navigate international trade challenges effectively.

The upgraded price target reflects KeyBanc’s confidence in ResMed’s financial trajectory, underpinned by the latest quarterly results and the company’s strategic positioning to mitigate tariff-related concerns. As ResMed continues to operate with most of its products registered under the Nairobi Protocol, the company appears well-positioned to maintain its financial stability and growth momentum.

In other recent news, ResMed reported its third-quarter fiscal year 2025 earnings, revealing an 8% increase in revenue year-over-year to $1.3 billion, which surpassed expectations. Earnings per share (EPS) were slightly below forecasts at $2.37, but still represented an 11% increase from the previous year. The company’s gross margin improved significantly, partly due to manufacturing and distribution efficiencies, and was further aided by exemptions from certain global tariffs under the Nairobi Protocol. Analysts from Oppenheimer maintained a Perform rating on ResMed, highlighting the company’s solid revenue performance and its strategic expansion plans, including a new manufacturing plant in Calabasas, California, set to open in June 2025.

Mizuho (NYSE:MFG) Securities also kept its Outperform rating on ResMed, despite reducing the stock’s price target to $250 from $265, following a mixed performance in global devices revenue and CPAP re-supply revenue. The firm noted ResMed’s strong position in tariff regulations and its proactive measures to educate GLP-1 prescribers, which are yielding positive returns. ResMed continues to invest in digital health initiatives and has launched new products like Nite Owl, a home sleep apnea test, and the AirSense 11 version of VpAP TX, aimed at enhancing patient diagnosis and therapy adherence.

Both Mizuho and Oppenheimer analysts noted potential challenges for ResMed, particularly from GLP-1 medications, which could alter the market dynamics for CPAP devices. However, ResMed’s strategic initiatives, including expanding its manufacturing capabilities and focusing on educational programs for healthcare providers, are expected to support its growth and market position. These developments underscore ResMed’s ongoing efforts to adapt to evolving market conditions and its commitment to maintaining a strong presence in the sleep health industry.

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