This week small-cap medical device business Somnomed Limited (ASX: SOM) posted total revenues of $11.1 million for the quarter ending March 31 2016, up 32% over the prior corresponding quarter.

The company sells mouth-guard like devices that patients use for the treatment of sleep-related breathing disorders and claims it has treated more than 250,000 patients in 27 countries since its establishment.

Its main operating region is the giant US healthcare market, with unit sales up 21.1% in the region, although it also delivered strong sales growth in European and Asia Pacific markets.

The shares are up 18% over the past year and 80% over the past two years, with the strong outlook not escaping the attention of brokers like Wilson HTM and Morgans. Both retain share price targets well above the $2.62 level that shares change hands for today.

Wilson HTM has a decent track record at unearthing successful small caps and believes that SomnoMed is on track to meet full year earnings guidance. It has a $3.50 share price target, which is more than 25% above today’s levels.

Morgans is forecasting that SomnoMed will bring in revenues of $44.8 million for the full financial year and also rates the shares a buy with a $3.10 price target.

SomnoMed is a junior rival of sleep treatment medical device specialist ResMed Inc. (CHESS), which has a market value around $10.7 billion and primary listing on the New York Stock Exchange.

ResMed’s blockbuster success being based on the large global markets for the treatment of sleep apnea, bulletproof revenue growth, and its ability to maintain healthy profit margins thanks to the market-leading nature of its products.

Broker Goldman Sachs has a $9 price target on ResMed’s ASX-listed scrip, which is some 15% above the $7.65 price that shares change hands for today.

Australian holders of ResMed scrip will also benefit if the Australian dollar trends lower through the rest of 2016, and now looks a good time to buy the stock in my opinion.

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Motley Fool contributor Tom Richardson owns shares of ResMed Inc..

You can find Tom on Twitter @tommyr345

The Motley Fool Australia has no position in any of the stocks mentioned. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.