ResMed Is Near Its 52-Week Low Despite 21% EPS Growth: What the GLP-1 Fear Is Getting Wrong

Key Stats for ResMed Stock

• 52-Week Range: $180.27 – $293.81
• Current Price: $188.63
• Street Mean Target: around $262
• TIKR Mid-Case Model Target (2030): around $262
• Mid-Case Annualized IRR: just under 9% per year
• Q3 FY2026 Revenue: $1.43 billion, up 11% year over year
• Q3 FY2026 Non-GAAP EPS: $2.86, up 21% year over year

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ResMed Inc. (RMD) posted 11% revenue growth and 21% earnings per share growth in its most recent quarter, expanded gross margins, and reiterated a five-year outlook of high-single-digit revenue growth, with earnings growing faster.

The stock sits near a 52-week low. That gap fits in one sentence: the market is pricing in a future where GLP-1 weight-loss drugs shrink the global pool of sleep apnea patients, and nobody yet knows whether that future arrives on the timeline investors are assuming.

What Happened at ResMed

ResMed makes CPAP devices, masks, and accessories used to treat obstructive sleep apnea, a condition strongly linked to obesity that affects an estimated 936 million people globally.

The business is structurally recurring, since patients need replacement masks and accessories every few months regardless of economic conditions, and ResMed holds the leading global share in both devices and software for home respiratory care.

Q3 fiscal 2026, reported in late April, continued a pattern of consistent execution. Revenue reached $1.43 billion, up 11% year over year, with masks and accessories growing 12% globally, the highest-margin part of the device business.

Non-GAAP EPS of $2.86 grew 21%, ahead of consensus. Gross margin expanded to 62.2% from 59.3% a year earlier. Operating cash flow was $554 million for the quarter, and the company ended the period with $1.66 billion in cash against a balance sheet TIKR shows as carrying net cash, meaning the balance sheet is a net asset rather than a liability.

On the earnings call, CEO Mick Farrell addressed the GLP-1 question directly. He called weight-loss drugs “a once-in-a-generation demand gen opportunity for ResMed,” citing data showing that patients who receive GLP-1 prescriptions are more likely to initiate CPAP therapy than those without, since the doctor visits required for GLP-1 treatment surface undiagnosed sleep apnea at higher rates.

ResMed documented nearly 1.95 million of its own CPAP patients who also hold GLP-1 prescriptions, a figure that suggests co-therapy rather than substitution is the dominant near-term pattern.

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What the Valuation Model Says

TIKR’s mid-case model, run at a current price of $186.29, targets around $262 by mid-2030, implying a total return of around 41% and an annualized return of just under 9%.

The model assumes revenue growth of around 7% annually, net income margins expanding toward 29%, and a P/E multiple that contracts modestly over time. Even with that multiple compression baked in, the model implies returns well above what most large-cap healthcare equities are priced to generate from current levels.

The Street’s mean target sits around $262, essentially matching TIKR’s model, but the median target is $240, suggesting the average is being pulled up by a handful of high-conviction bulls. Of the 15 analysts TIKR tracks, 10 rate the stock a buy or outperform, 8 rate it hold, and 1 rates it sell.

That distribution has been remarkably stable all year, even as the stock has fallen from $258 in June 2025 to $186 today, implying the implied upside in analyst targets has widened to nearly 141% of the current close. The low target of $180 sits just below where the stock currently trades.

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Should You Invest in ResMed, Inc?

The bull case is that a business with 62% gross margins, net cash, 21% EPS growth, and a global addressable market of hundreds of millions of undiagnosed patients is trading near a 52-week low, driven by fears that the operating data does not yet support it.

TIKR’s model and the Street’s mean target both point to around 40% upside from current levels. The bear case is that GLP-1 adoption accelerates, long-term sleep apnea prevalence declines meaningfully in the early 2030s, and the market is right to assign a lower multiple today in anticipation of slower growth ahead.

Morgan Stanley cut its target to $230 from $286 this week, flagging GLP-1 risk and the potential return of Philips to the PAP device market as near-term headwinds. At $188, the investment case for ResMed is essentially a bet on whether the current operating trajectory tells you more about the future than the GLP-1 narrative does.

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Disclaimer:

Please note that the articles on TIKR are not intended to serve as investment or financial advice from TIKR or our content team, nor are they recommendations to buy or sell any stocks. We create our content based on TIKR Terminal’s investment data and analysts’ estimates. Our analysis might not include recent company news or important updates. TIKR has no position in any stocks mentioned. Thank you for reading, and happy investing!