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Is This the Right Time to Retain Resmed Stock in Your Portfolio?
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Key Takeaways
Resmed is selling MatrixCare for $490M, sharpening its software focus on higher-growth platforms.
RMD's global Masks and other revenues rose 13% in fiscal 2026 to $2.09B, aided by product innovation.
Resmed faces macroeconomic, tariff and competitive pressures that could weigh on costs and pricing.
Resmed (RMD - Free Report) benefits from the portfolio reduction of its Residential Care Software segment, which is poised to continue supporting its growth in the coming quarters. The company continues to expand its mask portfolio through product innovation and targeted initiatives that support resupply. Solid financial health further adds to the stock’s appeal. Yet, headwinds from macroeconomic pressures and intense competition may present operational risks for Resmed.
Over the past year, this Zacks Rank #3 (Hold) stock has lost 17.7% compared with the industry’s 29.8% decline and the S&P 500 Composite’s 16.6% growth.
The renowned medical device company has a market capitalization of $28.44 billion. RMD has an earnings yield of 5.5% compared with the industry’s yield of 2.6%. RMD’s earnings surpassed estimates in each of the trailing four quarters, delivering an average surprise of 2.8%.
Let’s delve deeper.
Upsides for RMD Stock
Residential Care Software Portfolio Optimization: Residential Care Software remains an important part of Resmed’s connected home-care strategy, but management is narrowing the portfolio toward areas with better growth and profitability. Resmed agreed to sell the MatrixCare business for $490 million in cash, including MatrixCare, HEALTHCAREfirst, Citus and select home health and hospice offerings. The divestiture is expected to be closed in the first quarter of fiscal 2027, leaving Brightree and MEDIFOX DAN as the core Residential Care Software platforms.
In fiscal 2026, segment revenues increased about 5% and operating profit rose 6.2% over fiscal 2025. MatrixCare contributed $220 million to fiscal 2026 revenues and $58 million to non-GAAP operating profit. Following the divestiture, management expects the remaining business to deliver high-single-digit revenue growth in fiscal 2027, with operating leverage supporting profitability.
Mask Innovation and Resupply: Resmed has been a consistent innovator in small nasal, nasal pillows and full-face masks, with designs aimed at improving comfort, fit and adherence. The company continues to broaden the AirFit and AirTouch platforms while using education and direct-to-consumer activity to support resupply. In fiscal 2026, global Masks and other revenues increased 13% year over year, or 12% at constant currency, to $2.09 billion. The latest product cycle extends that momentum.
During the fourth quarter of fiscal 2026, management cited continued global rollout of the AirTouch N30i and AirTouch F30i and uptake of the AirFit F40. Resmed also reported that AirTouch N30i users had 6% higher 90-day compliance than users of its silicone equivalent. Better adherence can support longer therapy duration and more frequent resupply, reinforcing the recurring revenue profile over time.
What Ails RMD?
Macroeconomic Sensitivity: Resmed remains exposed to macroeconomic conditions, geopolitical instability, and the impact of tariffs and trade actions on its suppliers and input costs. These factors can weigh on demand, influence pricing and raise operating costs through higher freight, labor or component expenses, while currency volatility can also affect reported results.
Image Source: Zacks Investment Research
Competitive Landscape: The market for sleep-disordered breathing products remains highly competitive on price, product features, reliability and supply performance. Large providers and payers can gain purchasing leverage as healthcare markets consolidate, which can make account retention more costly.
Some competitors are also affiliated with customers, creating additional channel risk in selected markets. The company must therefore sustain innovation in connected devices, fabric masks and digital services while maintaining service levels and manufacturing efficiency. Failure to differentiate could reduce realized pricing and weaken the recurring resupply economics that support the broader sleep-health franchise.
RMD Stock’s Estimate Trend
The Zacks Consensus Estimate for RMD’s fiscal 2027 earnings per share (EPS) has moved south 0.1% to $12.02 in the past 30 days.
The Zacks Consensus Estimate for fiscal 2026 revenues is pegged at $5.87 billion, up 3.8% from the year-ago reported figure.
Veracyte has an earnings yield of 4.7% against the industry’s negative 1.4% yield. Shares of the company have risen 28.2% against the industry’s 3.8% decline. VCYT’s earnings outpaced estimates in each of the trailing four quarters, the average surprise being 41.8%.
Globus Medical, sporting a Zacks Rank #1 at present, has an earnings yield of 6.7% against the industry’s negative 1.4% yield. Its earnings surpassed estimates in each of the trailing four quarters, with the average surprise being 27.9%. GMED shares have rallied 27.3% against the industry’s 3.8% decline over the past year.
Teleflex, currently carrying a Zacks Rank #2 (Buy), has an estimated long-term earnings growth rate of 20.7% compared with the industry’s 14.5% growth. Its earnings beat estimates in three of the trailing four quarters and missed on one occasion, the average surprise being 3.2%. TFX shares have gained 4% against the industry’s 3.7% decline over the past year.
View the Zacks #1 Rank List
Image: Bigstock
Is This the Right Time to Retain Resmed Stock in Your Portfolio?
Key Takeaways
Resmed (RMD - Free Report) benefits from the portfolio reduction of its Residential Care Software segment, which is poised to continue supporting its growth in the coming quarters. The company continues to expand its mask portfolio through product innovation and targeted initiatives that support resupply. Solid financial health further adds to the stock’s appeal. Yet, headwinds from macroeconomic pressures and intense competition may present operational risks for Resmed.
Over the past year, this Zacks Rank #3 (Hold) stock has lost 17.7% compared with the industry’s 29.8% decline and the S&P 500 Composite’s 16.6% growth.
The renowned medical device company has a market capitalization of $28.44 billion. RMD has an earnings yield of 5.5% compared with the industry’s yield of 2.6%. RMD’s earnings surpassed estimates in each of the trailing four quarters, delivering an average surprise of 2.8%.
Let’s delve deeper.
Upsides for RMD Stock
Residential Care Software Portfolio Optimization: Residential Care Software remains an important part of Resmed’s connected home-care strategy, but management is narrowing the portfolio toward areas with better growth and profitability. Resmed agreed to sell the MatrixCare business for $490 million in cash, including MatrixCare, HEALTHCAREfirst, Citus and select home health and hospice offerings. The divestiture is expected to be closed in the first quarter of fiscal 2027, leaving Brightree and MEDIFOX DAN as the core Residential Care Software platforms.
In fiscal 2026, segment revenues increased about 5% and operating profit rose 6.2% over fiscal 2025. MatrixCare contributed $220 million to fiscal 2026 revenues and $58 million to non-GAAP operating profit. Following the divestiture, management expects the remaining business to deliver high-single-digit revenue growth in fiscal 2027, with operating leverage supporting profitability.
Mask Innovation and Resupply: Resmed has been a consistent innovator in small nasal, nasal pillows and full-face masks, with designs aimed at improving comfort, fit and adherence. The company continues to broaden the AirFit and AirTouch platforms while using education and direct-to-consumer activity to support resupply. In fiscal 2026, global Masks and other revenues increased 13% year over year, or 12% at constant currency, to $2.09 billion. The latest product cycle extends that momentum.
During the fourth quarter of fiscal 2026, management cited continued global rollout of the AirTouch N30i and AirTouch F30i and uptake of the AirFit F40. Resmed also reported that AirTouch N30i users had 6% higher 90-day compliance than users of its silicone equivalent. Better adherence can support longer therapy duration and more frequent resupply, reinforcing the recurring revenue profile over time.
What Ails RMD?
Macroeconomic Sensitivity: Resmed remains exposed to macroeconomic conditions, geopolitical instability, and the impact of tariffs and trade actions on its suppliers and input costs. These factors can weigh on demand, influence pricing and raise operating costs through higher freight, labor or component expenses, while currency volatility can also affect reported results.
Image Source: Zacks Investment Research
Competitive Landscape: The market for sleep-disordered breathing products remains highly competitive on price, product features, reliability and supply performance. Large providers and payers can gain purchasing leverage as healthcare markets consolidate, which can make account retention more costly.
Some competitors are also affiliated with customers, creating additional channel risk in selected markets. The company must therefore sustain innovation in connected devices, fabric masks and digital services while maintaining service levels and manufacturing efficiency. Failure to differentiate could reduce realized pricing and weaken the recurring resupply economics that support the broader sleep-health franchise.
RMD Stock’s Estimate Trend
The Zacks Consensus Estimate for RMD’s fiscal 2027 earnings per share (EPS) has moved south 0.1% to $12.02 in the past 30 days.
The Zacks Consensus Estimate for fiscal 2026 revenues is pegged at $5.87 billion, up 3.8% from the year-ago reported figure.
Key Picks
Some better-ranked stocks in the broader medical space are Veracyte (VCYT - Free Report) , Globus Medical (GMED - Free Report) and Teleflex (TFX - Free Report) .
Veracyte has an earnings yield of 4.7% against the industry’s negative 1.4% yield. Shares of the company have risen 28.2% against the industry’s 3.8% decline. VCYT’s earnings outpaced estimates in each of the trailing four quarters, the average surprise being 41.8%.
VCYT sports a Zacks Rank #1 (Strong Buy) at present. You can see the complete list of today’s Zacks #1 Rank stocks here.
Globus Medical, sporting a Zacks Rank #1 at present, has an earnings yield of 6.7% against the industry’s negative 1.4% yield. Its earnings surpassed estimates in each of the trailing four quarters, with the average surprise being 27.9%. GMED shares have rallied 27.3% against the industry’s 3.8% decline over the past year.
Teleflex, currently carrying a Zacks Rank #2 (Buy), has an estimated long-term earnings growth rate of 20.7% compared with the industry’s 14.5% growth. Its earnings beat estimates in three of the trailing four quarters and missed on one occasion, the average surprise being 3.2%. TFX shares have gained 4% against the industry’s 3.7% decline over the past year.