However, Stifel also noted some areas of concern. Feedback from GLP-1 (Glucagon-like Peptide-1) studies showed a potential discrepancy with management's expectations. The studies suggested that pharmaceuticals might decrease the number of patients requiring CPAP therapy, which contrasts with management's view that it would lead to an expansion of the patient base.Additionally, while Stifel's diligence on ResMed's AirSense 11 product was favorable, there is an anticipation that the positive tailwinds driving device growth may begin to slow down.
The stock currently trades at a P/E ratio of 32.07, with relatively low volatility (Beta 0.68). Stifel stated that they would look for positive revisions to future estimates, particularly into the fiscal year 2026, as a potential catalyst for a more optimistic view of the stock that could drive the price higher from its current levels. For deeper insights into ResMed's valuation and growth prospects, investors can access the comprehensive Pro Research Report available on InvestingPro.
The initiation of coverage comes after Stifel conducted due diligence among 40 U.S. Sleep Specialists, which indicated that 2025 is expected to be another strong year for device growth. The feedback from these specialists was generally positive about the long-term benefits that wearable technology could have on the growth of new patients for CPAP (Continuous Positive Airway Pressure) devices. InvestingPro data reveals ResMed maintains strong financial health with a "GREAT" overall score, supported by robust profitability metrics and moderate debt levels.
However, Stifel also noted some areas of concern. Feedback from GLP-1 (Glucagon-like Peptide-1) studies showed a potential discrepancy with management's expectations. The studies suggested that pharmaceuticals might decrease the number of patients requiring CPAP therapy, which contrasts with management's view that it would lead to an expansion of the patient base.
Additionally, while Stifel's diligence on ResMed's AirSense 11 product was favorable, there is an anticipation that the positive tailwinds driving device growth may begin to slow down. Stifel stated that they would look for positive revisions to future estimates, particularly into the fiscal year 2026, as a potential catalyst for a more optimistic view of the stock that could drive the price higher from its current levels.
In other recent news, ResMed Inc (NYSE:RMD). has reported promising developments. The company's Q1 Fiscal Year 2025 Earnings Call revealed a significant 11% increase in revenue and an impressive 27% rise in operating profit, largely attributed to the demand for their sleep and respiratory health devices, notably the AirSense 10 and 11 platforms. In addition, ResMed's annual stockholders meeting resulted in the election of eleven directors and the ratification of KPMG LLP as the independent auditor for the fiscal year ending June 30, 2025.
The company also received approval for executive compensation, with a majority of approximately 93 million votes in favor. In terms of product innovation, ResMed announced the upcoming launch of the AirTouch N30i mask, expected to improve patient adherence due to its enhanced comfort.
Furthermore, the company is set to continue its expansion into digital health and adjacent markets, aiming to empower over 500 million people with its health tech solutions by 2030.
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