Global Expansion And Product Launches To Aid ResMed's Growth

On Mar 27, 2018, we issued an updated research report on ResMed Inc. (NYSE:RMD) . The stock carries a Zacks Rank #3 (Hold).

The company achieved strong global revenue growth over the past few quarters on the back of robust sales of sleep devices, respiratory care devices, mask systems and software solutions. Also, synergies drawn from Brightree’s acquisition have acted as a significant contributor to ResMed’s operating results through 2017.

We expect the company’s product launches and strategies to gain traction in the sleep-disordered breathing market and further boost its near-term performance. Among the recent developments, ResMed has already informed about its first self-branded portable oxygen concentrator, Mobi, scheduled to launch in third-quarter fiscal 2018. Further, it has introduced AirMini, the world's smallest PAP (positive airway pressure) device.

Significantly, the leading medical devices company continues to invest resources and expand footprint in high-growth markets like China, South Korea, India, Brazil and many countries in the Eastern Europe. Interestingly, in each region, the company implements long-term plans to improve the quality of patient life for delivering better-patient outcomes and reducing overall system healthcare costs. In second-quarter fiscal 2018, revenues at the United States, Canada and Latin American countries grew 12% year over year while Europe, Asia and other markets improved 15% year over year at CER (constant exchange rate).

In the past three months, shares of ResMed have outperformed the broader industry with the stock having rallied 13.6%, higher than the broader industry’s 0.6% rise.

However, challenges like competitive bidding and reimbursement issues continue to plague the stock. The company also remains exposed to foreign exchange fluctuations. Additionally, rising operating expenses are other major headwinds.

Key Picks

Some better-ranked stocks in the broader medical sector are Bio-Rad Laboratories (NYSE:BIO) , athenahealth, Inc. (NASDAQ:ATHN) and Edwards Lifesciences Corporation (NYSE:EW) .

Bio-Rad Laboratories sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here. It has a long-term expected earnings growth rate of 20%.

athenahealth is a Zacks #1 Ranked player. It has a long-term expected earnings growth rate of 21.5%.

Edwards Lifesciences has a long-term expected earnings growth rate of 15.1%. The stock carries a Zacks Rank #2 (Buy).

Investor Alert: Breakthroughs Pending

A medical advance is now at the flashpoint between theory and realization. Billions of dollars in research have poured into it. Companies are already generating substantial revenue, and even more wondrous products are in the pipeline.

Cures for a variety of deadly diseases are in sight, and so are big potential profits for early investors. Zacks names 5 stocks to buy now.

Click here to see them >>