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Investors in ResMed Inc (ASX: RMD) are celebrating as the company's share price experiences a robust surge, climbing 6.5% to AU$28.50 on 25 January 2024. The market excitement follows ResMed's outstanding second-quarter results, surpassing expectations and instilling confidence among shareholders.
ResMed's Remarkable Second Quarter Results
ResMed reported a substantial 12% increase in revenue, reaching US$1.2 billion for the second quarter of fiscal year 2024. The company also achieved a commendable 20% lift in non-GAAP operating profit and non-GAAP diluted earnings per share of US$1.88. These figures exceeded consensus estimates, which projected revenue at US$1.15 billion and earnings per share at US$1.78.
Broker Reactions
Goldman Sachs reacted positively to ResMed's results, praising the company's top-line growth and earnings performance. The broker highlighted the improvement in gross margins and a decline in SG&A intensity, contributing to the favorable outcome.
Financial Metrics Overview
A closer look at financial metrics reveals that ResMed's 2Q24 revenue of AU$1,163 million marked an 11% year-on-year increase, exceeding consensus estimates. The growth was particularly strong in regions outside the United States, with a +12% increase compared to a +9% growth in the U.S. The Software as a Service (SaaS) segment grew by +24%, showcasing both organic growth and the contribution from Medifox Dan.
ResMed's Stance on GLP-1s and Future Outlook
Notably, ResMed remains optimistic about GLP-1 impacts, considering them positive for patients entering the funnel and for adherence/resupply rates. Despite not providing specific guidance, the company emphasizes its belief that GLP-1s, like Ozempic, pose no threat but instead contribute positively to its overall strategy.
Goldman's Rating and Price Target
Goldman Sachs, maintaining a buy rating, set a price target of AU$32.00 on the ResMed share price, indicating continued confidence in the company's future performance.
Conclusion
In conclusion, ResMed's recent financial success has provided shareholders with a reason to rest easy. The company's strong performance, positive outlook, and endorsement from financial analysts position ResMed as a notable player in the healthcare sector, worthy of investor attention.
