Wells Fargo & Company Issues Pessimistic Forecast for ResMed (NYSE:RMD) Stock Price

Key Points

• Wells Fargo cut its price objective on ResMed from $270 to $227 and maintained an "equal weight" rating, implying roughly an 11% upside from the prior close.
• Q3 beat: ResMed posted $2.86 EPS vs. $2.79 and $1.43B revenue (+10.8% YoY) with margin expansion and $554M operating cash flow, returned $262M via buybacks/dividends and declared a $0.60 quarterly dividend, yet the stock sold off after the report.
• Mixed outlook: Analysts' consensus is a "Moderate Buy" with a $290.64 target, while insiders have been selling and institutional investors hold about 55% of the shares.

ResMed (NYSE:RMD - Get Free Report) had its price objective decreased by equities research analysts at Wells Fargo & Company from $270.00 to $227.00 in a research report issued on Friday,Benzinga reports. The brokerage presently has an "equal weight" rating on the medical equipment provider's stock. Wells Fargo & Company's price objective suggests a potential upside of 11.14% from the stock's previous close.

RMD has been the subject of a number of other research reports. Wall Street Zen lowered shares of ResMed from a "buy" rating to a "hold" rating in a research report on Saturday, March 14th. Evercore set a $255.00 target price on shares of ResMed and gave the stock an "outperform" rating in a research report on Monday, April 13th. JPMorgan Chase & Co. assumed coverage on shares of ResMed in a research report on Wednesday, April 15th. They set an "overweight" rating for the company. Royal Bank Of Canada increased their price objective on shares of ResMed from $311.00 to $314.00 and gave the company an "outperform" rating in a research report on Friday, January 30th. Finally, Weiss Ratings lowered shares of ResMed from a "buy (b-)" rating to a "hold (c+)" rating in a research report on Thursday, March 19th. One research analyst has rated the stock with a Strong Buy rating, nine have issued a Buy rating and five have assigned a Hold rating to the company's stock. Based on data from MarketBeat.com, the company presently has an average rating of "Moderate Buy" and a consensus target price of $290.64.

ResMed Price Performance

Shares of NYSE:RMD traded down $9.57 during midday trading on Friday, reaching $204.24. 677,936 shares of the company were exchanged, compared to its average volume of 1,081,365. The company has a current ratio of 3.06, a quick ratio of 2.32 and a debt-to-equity ratio of 0.06. The business's fifty day moving average is $233.35 and its two-hundred day moving average is $246.69. ResMed has a one year low of $198.64 and a one year high of $293.81. The stock has a market cap of $29.75 billion, a PE ratio of 20.16, a price-to-earnings-growth ratio of 1.40 and a beta of 0.93.

ResMed (NYSE:RMD - Get Free Report) last issued its earnings results on Thursday, April 30th. The medical equipment provider reported $2.86 earnings per share for the quarter, topping analysts' consensus estimates of $2.79 by $0.07. ResMed had a net margin of 27.53% and a return on equity of 25.20%. The firm had revenue of $1.43 billion during the quarter, compared to analyst estimates of $1.42 billion. During the same quarter in the prior year, the business earned $2.37 earnings per share. ResMed's revenue for the quarter was up 10.8% on a year-over-year basis. As a group, analysts predict that ResMed will post 11.05 earnings per share for the current year.

Insider Buying and Selling at ResMed

In other news, Director Peter C. Farrell sold 2,000 shares of the stock in a transaction on Wednesday, April 1st. The shares were sold at an average price of $225.00, for a total value of $450,000.00. The sale was disclosed in a filing with the SEC, which is available at this link. Also, CEO Michael J. Farrell sold 4,991 shares of the stock in a transaction on Monday, February 9th. The shares were sold at an average price of $273.78, for a total transaction of $1,366,435.98. Following the completion of the sale, the chief executive officer directly owned 466,223 shares in the company, valued at approximately $127,642,532.94. This represents a 1.06% decrease in their position. The SEC filing for this sale provides additional information. Insiders have sold 21,023 shares of company stock valued at $5,230,857 in the last quarter. 0.65% of the stock is owned by company insiders.

Institutional Investors Weigh In On ResMed

Several hedge funds and other institutional investors have recently made changes to their positions in RMD. First Trust Advisors LP raised its stake in shares of ResMed by 240.9% in the fourth quarter. First Trust Advisors LP now owns 1,517,592 shares of the medical equipment provider's stock valued at $365,542,000 after acquiring an additional 1,072,394 shares during the period. Norges Bank purchased a new stake in shares of ResMed in the fourth quarter valued at $249,068,000. Deutsche Bank AG raised its stake in shares of ResMed by 126.0% in the fourth quarter. Deutsche Bank AG now owns 1,413,477 shares of the medical equipment provider's stock valued at $340,464,000 after acquiring an additional 787,949 shares during the period. Morgan Stanley raised its stake in shares of ResMed by 25.0% in the fourth quarter. Morgan Stanley now owns 2,891,697 shares of the medical equipment provider's stock valued at $696,523,000 after acquiring an additional 578,559 shares during the period. Finally, Swedbank AB raised its stake in shares of ResMed by 103.1% in the fourth quarter. Swedbank AB now owns 1,102,476 shares of the medical equipment provider's stock valued at $265,553,000 after acquiring an additional 559,765 shares during the period. Hedge funds and other institutional investors own 54.98% of the company's stock.

ResMed News Roundup

Here are the key news stories impacting ResMed this week:

• Positive Sentiment: Q3 beat and margin expansion — ResMed reported $2.86 EPS vs. $2.79 expected and $1.43B revenue (up ~11% YoY). Gross margins improved ~290 bps and operating income rose, signaling improving unit economics and pricing/volume strength. Resmed Q3 Results
• Positive Sentiment: Cash flow, buybacks and dividend — Operating cash flow was strong ($554M) and the company returned $262M via repurchases/dividends; a $0.60 quarterly dividend (1.1% yield) was declared. These actions support shareholder returns and capital allocation discipline. Resmed Q3 Results
• Neutral Sentiment: CFO transition — CFO Brett Sandercock will retire and Aaron Bloomer has been named his successor; a named successor reduces execution risk but transitions can create short‑term uncertainty. ResMed names new CFO
• Neutral Sentiment: Longer‑term thesis still discussed — Analyst pieces argue stronger profit forecasts and sleep‑apnea market tailwinds could shift ResMed’s narrative, but these are forward‑looking and dependent on execution. Analyst view on forecasts
• Negative Sentiment: Stock sold off despite beats — Commentary and market flow indicate shares slipped after the report; possible drivers include profit‑taking, investor disappointment vs. expectations for bigger upside in guidance or near‑term growth, and rotation out of defensive healthcare names. RMD stock down despite Q3 beat

ResMed Company Profile

ResMed NYSE: RMD is a global medical device and cloud-connectivity company focused on improving outcomes for people with sleep-disordered breathing and chronic respiratory conditions. Founded in 1989, the company is headquartered in San Diego, California, and develops, manufactures and distributes a range of devices and software used by patients, clinicians and providers worldwide.

ResMed's product portfolio centers on noninvasive ventilation and sleep therapy equipment, including continuous positive airway pressure (CPAP) and bilevel devices, masks and related accessories for the treatment of obstructive sleep apnea and other respiratory disorders.

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