On Jan 25, 2018, we issued an updated research report on leading medical devices company, ResMed Inc. (NYSE:RMD) . The stock carries a Zacks Rank #2 (Buy).
ResMed exited the second quarter of fiscal 2018 on a promising note with earnings and revenues beating the Zacks Consensus Estimate. The company achieved solid double-digit global revenue growth in the quarter, led by sales from Software-as-a-Service business as well as mask products and devices.
ResMed achieved strong global revenue growth over the past few quarters on the back of robust sales of sleep devices, respiratory care devices, mask systems and software solutions. Also, Brightree has acted as a significant contributor to the company’s operating results through 2017.
We believe ResMed’s product launches and strategies to gain traction in the sleep-disordered breathing market and further boost the company’s performance in the near term. Among recent developments, ResMed informed about its first self-branded portable oxygen concentrator Mobi, subject to a fiscal third-quarter launch. It has also introduced AirMini, the world's smallest PAP (positive airway pressure) device.
Significantly, ResMed continues to invest and expand its footprint in high-growth markets like China, South Korea, India, Brazil and many countries in the Eastern Europe. Interestingly, in each region, the company implements long-term strategies to improve the quality of patient life for delivering better-patient outcomes and reducing overall system healthcare costs. In second-quarter fiscal 2018, revenues at U.S., Canada and Latin American countries grew 12% year over year while Europe, Asia and other markets improved 15% year over year at CER.
In the past three months, shares of ResMed have outperformed the broader industry with the stock having soared 51.9%, higher than the broader industry’s 30.1% rise.
However, challenges like competitive bidding and reimbursement issues continue to plague the stock. The company also remains exposed to foreign exchange fluctuations. Additionally, rising operating expenses are other major headwinds.
Other Key Picks
Some other top-ranked stocks in the broader medical sector are PetMed Express, Inc. (NASDAQ:PETS) , Myriad Genetics, Inc. (NASDAQ:MYGN) and Luminex Corporation (NASDAQ:LMNX) , each sporting a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
PetMed has a long-term expected earnings growth rate of 10%. The stock has surged roughly 74.1% in a year.
Myriad Genetics has a long-term expected earnings growth rate of 15%. The stock has skyrocketed 107.9% over a year.
Luminex has a long-term expected earnings growth rate of 16.3%. The stock has gained 7.9% over the last 12 months.
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PetMed Express, Inc. (PETS): Free Stock Analysis Report
Luminex Corporation (LMNX): Free Stock Analysis Report
ResMed Inc. (RMD): Free Stock Analysis Report
Myriad Genetics, Inc. (MYGN): Free Stock Analysis Report
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