Evaluating ResMed (RMD): Is There Hidden Value After a Week of Quiet Trading?

ResMed (RMD) shares have drawn attention following a muted day in the market, with a slight dip of less than 1%. Investors may be weighing the company’s steady long-term track record in comparison to recent short-term fluctuations.

See our latest analysis for ResMed.

ResMed's 1-year total shareholder return sits at 1.3%, reflecting a period where momentum has been slow to build. There have still been some strong long-term gains, such as a 14% total return over three years. Recent price movement has been mixed, suggesting investors are weighing future growth prospects against changing market sentiment.

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The question now is whether ResMed's recent underperformance means the stock is trading below its true value, or if the market has already factored in all future growth and left limited room for upside potential.

Most Popular Narrative: 15.1% Undervalued

The most followed narrative points to fair value being markedly higher than ResMed’s last closing price. Given this sizable gap, the story behind the valuation is catching serious attention.

Acceleration in adoption of home-based, cloud-connected therapy solutions and digital health platforms (including software like Brightree and AirView) enhances recurring high-margin revenue streams and increases both user retention and net profit margins over time.

Read the complete narrative.

Why does this narrative see so much upside? The real driver is a shift toward high-margin technology and a bullish outlook on earnings growth. Want to discover the assumptions that unlock this valuation? Tap to see what propels expectations beyond current consensus.

Result: Fair Value of $295.13 (UNDERVALUED)

Have a read of the narrative in full and understand what's behind the forecasts.

However, risks remain, including slower growth in the U.S. device market and pressure from emerging therapies, both of which could limit ResMed’s upside.

Find out about the key risks to this ResMed narrative.

Build Your Own ResMed Narrative

If you think your perspective differs or enjoy digging through the numbers yourself, you can put together your own view faster than you might expect, then Do it your way

A good starting point is our analysis highlighting 4 key rewards investors are optimistic about regarding ResMed.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

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