ResMed heads into its July 30 earnings report with short sellers adding positions at a meaningful pace while options traders turn notably less defensive than usual.
Short interest has climbed sharply over the past month — up 19% in 30 days to 10.1% of the free float, a genuinely elevated level for a large-cap medtech name. The build has been steady through July, with short shares rising from around 13.4 million in mid-June to nearly 14.8 million now. Despite that accumulation, the borrow market remains loose. Availability runs at roughly 248% of short interest — meaning there are more than two shares available to lend for every one already shorted — and borrowing costs have actually eased 12% over the past week to under 0.5% annually. That combination points to a crowding-in of bearish bets that faces no squeeze pressure whatsoever.
Options positioning, however, is pulling in the opposite direction. The put/call ratio has dropped to 1.57, well below its 20-day average near 1.95 and close to its 52-week low of 1.02 — a reading that sits nearly 1.5 standard deviations below the recent norm. Through mid-July the PCR was running above 2.0 and as high as 2.4; in the past week it has compressed sharply. That compression signals options traders are buying fewer puts and more calls relative to recent habit, a shift toward bullish positioning even as short sellers are leaning the other way. The divergence is the defining tension heading into the print.
Analysts have been trimming targets with unusual consistency. Citigroup downgraded RMD to Neutral earlier this month, cutting its target from $270 to $235. Mizuho maintained its Outperform rating but dropped its target from $235 to $220. Those July moves follow June downgrades from Morgan Stanley — which pulled its Overweight — and a series of target reductions from RBC, Jefferies, Wells Fargo and Keybanc. The mean consensus target now stands at $248.60, roughly 27% above the current price of $195.27, which might look generous given the direction of travel. Bulls point to strong mask sales growth above 16% year-over-year, gross margins of 62.3% beating consensus, and an EPS that topped estimates last quarter. Bears counter that management guided full-year device segment growth down to mid-single digits from high-single digits, international device sales are underperforming, and GLP-1 drugs remain a long-term structural threat to the addressable sleep apnea market. EPS momentum is a rare bright spot in the factor scores — ranking in the 93rd percentile over 30 days — but forward EPS growth expectations rank in just the 30th percentile, underscoring the market's caution about the outer years.
The stock itself is down roughly 2% on the week and up just 2% over the past month, lagging correlated peers: SYK gained 3.2% on the week while GEHC fell 4%. RMD is trading somewhere in between — directionless, not clearly following the group. The July 30 print will test whether the 19% surge in short interest over the past month reflects genuine earnings-risk hedging or an overcrowded bearish trade that a solid mask-and-margin story could force to unwind.
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