“Resmed’s second quarter results were above expectations, with double-digit top line and bottom line growth, improving operating leverage and strong cash flow,” Raymond said.
“Devices grew above market expectations (+11%), on strong demand and ex-US could-connected availability, while masks (+9%) tracked expectations, driven by resupply and new patient setups, despite softer ex-US sales (+4% constant currency on a tough comparable period of +14%).
“Operating margin expanded 190 basis points on previous corresponding period (the first time in 11 quarters) and sequentially (+250 basis points) on improving gross profit margin and good cost control, with further gains expected.
“Management presented real-world data from 529,000 obstructive sleep apnoea (OSA) patients prescribed GLP-1s showing an increased likelihood of not only starting PAP therapy, but also improving re-supply rates over time vs OSA patients not prescribed GLP-1s.
“We adjust financial years 2024-2026 forecasts modestly, with our target price rising to $32.82,” Raymond said.
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