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Canaccord Genuity Maintains a 'Hold' on ResMed (RMD); Raising PT on Solid Q3

April 27, 2012 11:26 AM EDT Send to a Friend
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Price: $50.17 +0.84%

Rating Summary:
    5 Buy, 8 Hold, 1 Sell

Rating Trend: = Flat

Today's Overall Ratings:
    Up: 23 | Down: 38 | New: 43
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Canaccord Genuity maintains a 'Hold' on ResMed (NYSE: RMD) price target raised to $32.00.

Analyst, Jason R. Mills, said, "RMD delivered strong revenue and earnings in F3Q, driven in large part by strong US sales versus easy Y/Y comparisons, solid GM, lower tax rate and share buyback. Operating income growth – which had been negative over the past 3 quarters – rebounded (+22%). With easy comps over the next few quarters, we expect OI growth to stay around these levels near term. New products in both masks and flow generators (namely in the US), coupled with positive mix shift in flow generators to APAP and Bi-level, should help RMD maintain double-digit revenue growth in the US. However, OUS growth – facing difficult comps and sluggish economic conditions - grew 4% and may continue to under-perform, in our view. We model operating income growth improving to 12% in F13E from 9% in F12E. We model 11% EPS growth in F13E, with variance largely depending on further tax rate reductions and/or share repurchases, in our estimation."

For an analyst ratings summary and ratings history on ResMed click here. For more ratings news on ResMed click here.

Shares of ResMed closed at $32.05 yesterday.




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