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RMD · Analysis updated Nov 10, 2026, 6:00 PM ET
Why is ResMed Inc. (RMD) stock moving?
ResMed reported a Q1 FY2027 beat on Oct 29, with revenue of $1.415B and adjusted EPS of $2.91 versus estimates of $1.392B and $2.67. The FY2027 guidance was roughly in line, with adjusted EPS of $12.00-$12.25 against $12.09 and sales of $5.75B-$5.85B against $5.814B. Operating margin fell 140 bps to 32.0% and SG&A rose 12%, which likely weighed on the stock. The shares dropped 9.1% on Oct 30 from $252.83 to $229.94, on volume of 3.47M, roughly 2x to 3x the prior sessions. They have since rebounded to $234.11 on Nov 10 with volume normalizing near 1.2M, but remain about 7% below the pre-results close. Several brokers raised price targets after results, including RBC to $288, KeyBanc to $277, Citigroup to $270 and Wells Fargo to $250, averaging roughly $271. However, Canaccord cut to Hold and Morgans and Ord Minnett moved to Accumulate, which tempers the near-term picture. Positives include the reiterated annual guidance (which Macquarie reads as potentially conservative), more than $1.0B returned to shareholders in Q1, and the closed MatrixCare divestiture. Overall, the evidence is mixed: strong results and higher targets against recent downgrades and a margin dip.
News behind the analysis
- ResMed Inc. Reports Results for the First Quarter of Fiscal Year 2027Q1 revenue rose 6% to $1.4B and non-GAAP diluted EPS rose 14% to $2.91, both above analyst expectations. The company returned more than $1.0B to shareholders through buybacks and dividends.
- ResMed Sees FY2027 Adj EPS $12.00-$12.25 vs $12.09 Est; Sees Sales $5.750B-$5.850B vs $5.814B EstFY2027 adjusted EPS guidance is $12.00-$12.25, with the range midpoint slightly below the $12.09 estimate. The sales guidance midpoint of about $5.80B also sits slightly below the $5.814B estimate.
- ResMed Q1 Adj. EPS $2.91 Beats $2.67 Estimate, Sales $1.415B Beat $1.392B EstimateAdjusted EPS of $2.91 beat the $2.67 estimate, and sales of $1.415B beat the $1.392B estimate. The quarter lifted expectations, but the guidance midpoint was in line to slightly below consensus.
- Canaccord Genuity Downgrades ResMed to Hold from BuyCanaccord Genuity cut its rating on ResMed from Buy to Hold. This is one of two downgrades in the week after results.
- Macquarie Analyst Comments on ResMed's Annual GuidanceMacquarie said that ResMed's reiteration of its annual revenue guidance implies a potential operational upgrade. This is a positive read on the guidance.
- ResMed Receives Analyst Downgrades from Morgans and Ord MinnettMorgans and Ord Minnett both moved their ratings on ResMed from Buy to Accumulate. These downgrades add to the cautious tone after the stock fell on results day.
- RBC Capital Maintains Outperform on ResMed, Raises Price Target to $288RBC kept its Outperform rating and raised its price target to $288 from $262. The target is well above the recent share price near $234.
- Keybanc Maintains Overweight on ResMed, Raises Price Target to $277KeyBanc kept its Overweight rating and raised its price target to $277. The update followed the fiscal Q1 2027 results.
- Citigroup Maintains Neutral on ResMed, Raises Price Target to $270Citigroup kept a Neutral rating and raised its price target to $270 from $240. The move followed the quarterly results.
- Wells Fargo Maintains Equal-Weight on ResMed, Raises Price Target to $250Wells Fargo kept an Equal-Weight rating and raised its price target to $250. The target sits above the recent trading range.
About ResMed Inc.
ResMed is a San Diego-based maker of CPAP machines, masks and other devices that treat sleep apnea and chronic respiratory conditions, plus software for care at home. It is one of the largest companies in sleep apnea devices, and many of its machines connect to the cloud so patients and providers can track whether the devices are being used.
How it makes money
Most revenue comes from selling sleep and breathing devices (such as AirSense CPAP machines) and the masks and accessories that patients replace regularly. Masks and accessories make up a bit over a third of sales and bring in steady repeat revenue. A smaller share, roughly 5–8%, has come from software for home and residential care providers. ResMed has been moving to sell its MatrixCare unit, which brought in about $220 million in fiscal 2026. Fiscal 2026 revenue was roughly $5.7 billion, with the Americas as the largest region. The company also pays a quarterly dividend, recently $0.66 per share.
What usually moves RMD
- Sleep apnea diagnosis rates and demand for devices
- Concerns about GLP-1 weight-loss drugs reducing CPAP demand
- Reimbursement and coverage from Medicare and insurers
- Gross margin trends and component and tariff costs
- Competition and product recalls in the CPAP market