Macquarie has long maintained the mantra that ResMed’s valuation, now 36.8x forward earnings and a 38% premium to medical device peers, ascribes limited medium-term risk in relation to reimbursement changes or the longer-term impact of competing technologies. Underperform retained.
Ahead of this week’s result release, the broker has made minor adjustments to revenue and growth assumptions and currency. Target rises to $17.00 from $16.50.
Sector: Health Care Equipment & Services.
Target price is $17.00.Current Price is $23.90. Difference: ($6.90) – (brackets indicate current price is over target). If RMD meets the Macquarie target it will return approximately -41% (excluding dividends, fees and charges – negative figures indicate an expected loss).
