Citi rates ResMed Inc (RMD) as a Buy - The broker notes that although the shares have struggled hard on the resurfacing of competitive bidding concerns, the reaction is largely overdone and current levels are presenting a great buying opportunity. Citi believes the current situation will also offer a valuable opportunity for the company to return excess capital via the current buyback, which is already highly EPS and value-accretive. The price target is $5.79 (current price $4.82) with FY14 PER looking cheap at 15x. However, Citi notes significant upside risk to its forecasts if falls in the AUD continue.
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