The Resmed Inc (ASX: RMD) share price is charging higher again this morning after its strong financial results late last week boosted investor confidence.
At the time of writing, the Resmed share price is $44.92, up 4.33% for the day.
Over the past month, the share price has surged 14.39%, and it is now up 37% for the year.
For Q4 2025, to 30 June, ResMed reported a 10% increase in revenue to US$1.3 billion, a 230 basis points increase in its gross margin to 60.8%, and a 19% lift in income from operations.
Its full-year results were just as impressive. For FY2025, Resmed posted a 10% revenue increase to US$5.1 billion.
Here's what Macquarie Group Ltd (ASX: MQG) thinks of the stock.
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Macquarie's stance on Resmed shares
In a recent note to investors, the broker confirmed its outperform rating on Resmed shares and raised its target price to $48.60, up from $45.90.
At the time of writing, this represents a potential 8.2% upside for investors over the next 12 months.
Macquarie said it has raised its target price following earnings per share (EPS) revisions to reflect the company's updated operational forecasts and adjusted buyback assumptions.
The broker has raised its EPS expectations +3% for FY2026, +5% for FY2027, and +5% for FY2028.
It noted that Resmed's strong financial result gives the business significant operating leverage.
Strong revenue growth of 9% (CC) in 4Q25 vs pcp, geographically driven by strong growth in Americas, with RoW in line with expectations. Americas masks/accessories growth was supported by 2-month contribution from the VirtuOx acquisition (~US$7.5m).
Management notes some share gain following recent launches and an improving resupply program driving masks growth ahead of market. RMD continues to expect high single-digit organic revenue growth to FY29, as stated at the 2024 investor day, with our forecasts capturing ~8% growth pa.
The broker also liked Resmed's gross margin (GM) result of +61%, which is well ahead of forecasts. Driven primarily by operational efficiencies, including procurement, manufacturing, and logistics, Macquarie expects growth of 61-63% to continue in FY2026.
But Macquarie adds:
RMD expects gross margin of ~61-63% (MRE 62.2%). However, SG&A has increased to ~19-20% of sales from ~18-20% in FY25 guidance (MRE 19.3%) to support the recent rebranding and several targeted direct-to-consumer marketing campaigns. The FY26 tax rate is anticipated to be ~21-23% (MRE 21.8%) due the impact of tax legislation in different areas in FY26.
Elsewhere, Resmed's capital return to shareholders has also accelerated.
FY25 FCF increased +28% YoY to US$1.7b, with RMD in a net cash position of US$541m. The company has increased its dividend by +13% to $0.60 and doubled its share buyback budget for FY26 to $150m/quarter. The strong FCF conversion leaves room for additional growth for potential investments and M&A.
Resmed management is actively evaluating potential acquisitions and says it has a number of opportunities in the pipeline over the next 6-12 months.
