Why this broker is tipping the ResMed share price to rise 17%

A leading broker says ResMed shares can rise strongly from here…

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The ResMed Inc (ASX: RMD) share price is having a strong day on Wednesday.

In afternoon trade, the sleep treatment company’s shares are up a decent 3% to $32.52.

This latest gain means that the ResMed share price is now up an impressive 13% since this time last month.

Can the ResMed share price keep rising from here?

The good news for investors is that one leading broker doesn’t believe the company’s shares have peaked just yet. In fact, its analysts continue to see ResMed as one of the best options for investors in July.

According to a note out Morgans, its analysts have kept the company’s shares on their best ideas list with an add rating and $37.95 price target.

Based on the current ResMed share price, this implies potential upside of almost 17% for investors over the next 12 months.

Why is the broker bullish?

Morgans is bullish on ResMed due to its belief that the company is well-placed for long term growth thanks to its patient-centric connected-care digital platform.

And while it acknowledges that the near term could be a touch volatile, it thinks investors should look beyond this and focus more on the long term opportunity.

The broker commented:

While we believe the next few quarters will likely be volatile, as Covid-related demand for ventilators continues to slow and core sleep apnoea volumes gradually lift, nothing changes our medium/longer term view that the company remains well-placed as it builds a unique, patient-centric, connected-care digital platform that addresses the main pinch points across the healthcare value chain.

All in all, this could make ResMed shares worth considering if you’re on the lookout for options in the healthcare sector right now.

Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. has positions in and has recommended ResMed Inc. The Motley Fool Australia's parent company Motley Fool Holdings Inc. has recommended ResMed. The Motley Fool Australia has positions in and has recommended ResMed Inc. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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