On Thursday, RBC Capital Markets adjusted its outlook on ResMed (NYSE:RMD), a company specializing in medical equipment for treating sleep disorders, by increasing its price target to $255 from the previous $247. The firm has opted to maintain a Sector Perform rating on the stock.
The decision by analyst Craig Wong-Pan at RBC Capital follows ResMed’s third-quarter fiscal year 2025 results, which exhibited sustained robust growth in both revenue and earnings. The company’s revenue grew 9.38% over the last twelve months to $4.93 billion, with a healthy gross profit margin of 59%. Although the results met market expectations, the company’s announcement that its products would largely remain exempt from U.S. import tariffs stood out as a significant positive development.
RBC Capital’s revised price target is a reflection of minor adjustments to their forecasts, underpinned by an anticipated positive earnings growth trajectory for ResMed. The tariff exemptions are likely to contribute to the company’s continued financial health, providing a buffer against potential cost increases that could have arisen from tariff impositions.
The analyst’s commentary highlighted the strength of ResMed’s third-quarter performance, emphasizing the company’s solid growth momentum. "Robust growth and tariff exemptions; RMD’s 3Q25 result showed ongoing solid growth in revenue and earnings, albeit they were in line with market expectations. However, a positive update was that the company’s products should continue to be largely exempt from US import tariffs. We have made minor increases to our forecasts and maintain a positive earnings growth outlook for the stock. Our forecast changes increase our PT to $255 (from $247). SP rating maintained," Wong-Pan stated.
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