ResMed (RMD)

NYSEHealth CareMedical Instruments & SuppliesSnapshot 2026-07-07

$219.77+0.63%

Close 2026-07-07 · 1-day change

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The thesis

The standing, falsifiable read: what has to stay true, and what would break it.

Compounder

The bull case

ResMed grows revenue about 11% yearly, reaching $1.43B in Q3 2026. Profit margins stay strong near 62.5%. The company invests steadily in innovation and digital health. Free cash flow yield is solid at 5%.

The bear case

Margins face pressure, as recent guidance cuts and downgrades suggest. Revenue growth could slow below 10%. Management changes and software business sale may disrupt execution.

What's priced in

The price is about 7% below our fair value near $237 and 7% below the Street median. Analysts expect roughly 10% revenue growth, which aligns with our view. The market fairly values current growth and margin outlook.

What has to stay true

Maintain gross margin near 62-63%Under Pressure
Marginprimary62-63% gross margin · FY26 (guidance)
Breaks if: Gross margin falls below 60% in FY26
Are they delivering?On Track this quarter· 1 tracked commitment
- Maintain gross margin guidanceCost
  Maintain gross margin in the range of 62-63% for fiscal year 2026.
  On Track
  Stated in 3 of last 3 quarters. Gross margin was 62.5% in 2026-Q3, within the guided range of 62-63%. The company is delivering on its margin guidance commitment.
Continue investing in innovation and digital healthIntact
Management ExecutionsupportingSustain investment and digital health scaling progress · next 4 quarters (qualitative)
Breaks if: Investment in innovation stalls or digital health growth reverses
Are they delivering?On Track this quarter· 1 tracked commitment
- Invest in innovation and digital healthGrowth
  Continue investing in innovation and scaling digital health capabilities.
  On Track
  Stated in 4 of last 4 quarters. Revenue grew from $1.22B in 2025-Q1 to $1.43B in 2026-Q3, indicating progress in innovation and digital health. The trajectory shows delivering on growth initiatives.
Sustain revenue growth near 11% YoYIntact
Revenue Growthprimary>=11% YoY revenue growth · 2026-Q3 (guidance)
Breaks if: YoY revenue growth falls below ~10% next year
Are they delivering?On Track this quarter· 1 tracked commitment
- Invest in innovation and digital healthGrowth
  Continue investing in innovation and scaling digital health capabilities.
  On Track
  Stated in 4 of last 4 quarters. Revenue grew from $1.22B in 2025-Q1 to $1.43B in 2026-Q3, indicating progress in innovation and digital health. The trajectory shows delivering on growth initiatives.

Standing thesis, reviewed periodically — not a price target or advice.

Read the full Outlook — the long-form 1–3 year hold read

Not investment advice. Scores describe historical and current data; they are not forecasts of future returns. Consult a licensed advisor before making investment decisions.