Goldman Sachs starts coverage on ResMed with "buy" rating

Investing.com -- Goldman Sachs initiated coverage on ResMed Inc (NYSE: RMD) with a "Buy" rating and a price target of A$48.9, driven by strong growth prospects in its continuous airway pressure (CPAP) therapy segment.

Key drivers include rising awareness of obstructive sleep apnea (OSA), market share gains in OSA masks, and operating margin expansion through cost management and product mix. Goldman forecasts mask revenue growth exceeding consensus by 2.4%-10.7% for fiscal 2025-27.

The note highlights ResMed's ongoing innovation, with new mask and accessory launches expected in late 2024, and predicts the company could achieve the upper end of its fiscal 2030 revenue growth target.

Goldman believes CPAP therapy will coexist with GLP-1 drugs for OSA treatment, supported by clinical data and insurance policies. ResMed's app engagement also indicates strong therapy compliance.

The 12-month price target reflects a 30% upside, based on a blend of discounted cash flow and EV/EBIT multiples.

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