ResMed (RMD) Stock Forecast & Price Target

ResMed is supported by a structurally expanding sleep and respiratory care market, where low diagnosis rates and aging, obesity-linked demand create a long runway for mid-single-digit device growth, high-single-digit mask growth, and SaaS expansion. Its FY27 outlook appears credible because management has visibility into 5-7% Core CC growth, EPS of $12.00-$12.25, and low-double-digit basis-point gross margin expansion, aided by modest price increases, productivity gains, and roughly $1.5B of expected buybacks. The bullish view is further reinforced by a healthy balance sheet, strong free cash flow, portfolio simplification, and digital health investments that should deepen customer stickiness while supporting durable growth and higher returns.

ResMed is facing a more cautious fundamental setup because its FY27 revenue outlook of $5.75-5.85B implies only 5-7% y/y core growth and sits below Street expectations, while management also guided that FQ1:2027 core revenue ex-FX will decline sequentially. Margins are under pressure from component cost inflation, higher freight, and FX, with 4Q26 gross margin at 62.3% missing consensus, and the $41.9m Astral recall provision plus a $75m FY26 revenue contribution turning into a 130bps FY27 headwind add further drag. The bear case is reinforced by competitive risk, possible FDA actions, global healthcare-spending weakness, and uncertainty around GLP-1 adoption, all of which could limit the structural sleep apnea growth story.