An ongoing product recall for one of ResMed's top competitors opens up a big opportunity for the continuous positive airway pressure equipment maker, according to Mizuho. Analyst Anthony Petrone initiated coverage of the company with a buy rating and a price target of $255 per share, implying upside of 12.6% from Thursday's close.
"In aggregate, we see RMD settling at nearly ~60% permanent sleep device share, up from ~50%, as a result of the extended Philips CPAP recall," Petrone wrote on Thursday. Petrone added that ResMed has maintained its market share from a decline in Philips for longer than expected. "Our market model sized the US total market at $3.5bn today with a path to $6bn over the next 3-4 years," he said.
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