Key Stats for ResMed Stock
- Past week’s performance: -7.7%
- 52-week range: $199 to $294
- Valuation model target price: $249
- Implied upside: +21.4% over 2.2 years
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What Happened?
ResMed Inc. (RMD) reported fiscal Q3 2026 adjusted earnings per share of $2.86, beating analyst estimates of $2.80. Revenue reached $1.4 billion, up 11% year over year, and diluted earnings per share rose 10% to $2.74. Those results showed strong and consistent product demand across its device and software businesses.
Despite the beat, shares fell roughly 7.7% on the week and now trade near their 52-week low. Investor sentiment around ResMed has been weighed down by concern over GLP1 weight loss drugs. GLP1 medications, such as semaglutide, treat obesity and type 2 diabetes, and some researchers have suggested they may reduce the severity of sleep apnea over time.
ResMed also announced a CFO transition this week. CFO Brett Sandercock is retiring, and Rob Bloomer has been named his successor. Leadership transitions can create short-term uncertainty, but Sandercock is staying on during the handover to ensure continuity.
If RMD stock holds near its 52-week low, long-term investors may see the current price as a more compelling entry point given the company’s consistent earnings track record.
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Is ResMed Stock Undervalued?
Under valuation model assumptions realized through 12/31/28, the stock is modeled using:
- Revenue growth (CAGR): 8%
- Operating Margins: 36.7%
- Exit P/E Multiple: 17.2x
Based on these inputs, the model estimates a target price of $249, implying 21.4% total upside from the current share price and an annualized return of 9.3% over the next 2.2 years.
ResMed trades at roughly 17x forward earnings, which is significantly below its five-year historical P/E average of nearly 29.4x. That compression reflects investor fear about GLP1 drugs rather than any deterioration in fundamentals. The 8.0% revenue CAGR assumption is also conservative relative to ResMed’s recent one-year growth rate of 9.8%.
Operating margins of 36.7% represent a meaningful step up from current levels. ResMed’s gross margin already stands at 61.5%. As software and digital health revenue grow within the business, operating leverage should support higher profitability over time.
The 17.2x exit multiple reflects market skepticism about long-term patient volumes. But that multiple is well below ResMed’s own historical range of nearly 30x. At 9.3% annualized returns, the model suggests moderate attractiveness, and any easing of GLP1 concerns could drive meaningful multiple expansion back toward historical norms.
What’s Driving ResMed Stock Going Forward?
Device demand remains strong and is the most important near-term catalyst. ResMed launched its AirTouch F30i CPAP mask in the U.S. earlier this year, adding a new comfort-focused option to its lineup. CPAP stands for continuous positive airway pressure, which is the standard treatment for sleep apnea, and new mask designs improve patient comfort and long-term compliance.
The new distribution center in Greenwood, Indiana, is set to open in 2027. That facility will expand ResMed’s U.S. fulfillment capacity and improve delivery speeds. Better logistics directly support stronger device shipment volumes and customer satisfaction.
GLP1 drug risk is still the key uncertainty that investors are pricing into the stock. But ResMed has continued to grow revenue and earnings even as these concerns have persisted for over two years. Management has noted that most sleep apnea patients still need CPAP therapy even while taking GLP1 medications.
The CFO transition also creates short-term scrutiny. However, the handover is planned and orderly, and the company’s financial strategy is not expected to change. Investors will watch the next earnings call for any updated guidance on margins and international expansion.
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Should You Invest in ResMed?
The only way to really know is to look at the numbers yourself. TIKR gives you free access to the same institutional-quality financial data that professional analysts use to answer exactly that question.
Pull up RMD, and you’ll see years of historical financials, what Wall Street analysts expect for revenue and earnings in the quarters ahead, how valuation multiples have moved over time, and whether price targets are trending up or down.
You can build a free watchlist to track RMD alongside every other stock on your radar. No credit card required. Just the data you need to decide for yourself.
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Disclaimer:
Please note that the articles on TIKR are not intended to serve as investment or financial advice from TIKR or our content team, nor are they recommendations to buy or sell any stocks. We create our content based on TIKR Terminal’s investment data and analysts’ estimates. Our analysis might not include recent company news or important updates. TIKR has no position in any stocks mentioned. Thank you for reading, and happy investing!
