NYSE:RMD

Stock Analysis Report

NOT FOR DISTRIBUTION
Header cover image

Market Cap

US$39.1b

Last Updated

2021/08/03 00:34 UTC

Data Sources

Company Financials +

Executive Summary

ResMed Inc. develops, manufactures, distributes, and markets medical devices and cloud-based software applications that diagnose, treat, and manage respiratory disorders comprising sleep apnea, chronic obstructive pulmonary disease, neuromuscular disease, and other chronic diseases. More Details

Rewards

Earnings are forecast to grow 21.61% per year

Risk Analysis

No risks detected for RMD from our risk checks.


Snowflake Analysis

Excellent balance sheet with reasonable growth potential.


Similar Companies

Share Price & News

How has ResMed's share price performed over time and what events caused price changes?


Latest Share Price and Events

Stable Share Price: RMD is less volatile than 75% of US stocks over the past 3 months, typically moving +/- 3% a week.

Volatility Over Time: RMD's weekly volatility (3%) has been stable over the past year.


Market Performance


7 Day Return

3.4%

RMD

2.5%

US Medical Equipment

-0.4%

US Market


1 Year Return

33.0%

RMD

29.1%

US Medical Equipment

34.4%

US Market

Return vs Industry: RMD exceeded the US Medical Equipment industry which returned 29.8% over the past year.

Return vs Market: RMD underperformed the US Market which returned 35.9% over the past year.


Shareholder returns

RMDIndustryMarket
7 Day3.4%2.5%-0.4%
30 Day7.2%3.6%-0.4%
90 Day39.8%8.0%4.0%
1 Year34.0%33.0%30.0%29.1%36.5%34.4%
3 Year159.8%151.5%73.7%69.6%62.0%51.9%
5 Year307.7%280.7%148.7%137.1%121.8%97.2%

Long-Term Price Volatility Vs. Market

How volatile is ResMed's share price compared to the market and industry in the last 5 years?


Simply Wall St News

Valuation

Is ResMed undervalued compared to its fair value and its price relative to the market?

85.29x

Price to Earnings (PE) ratio


Share Price vs. Fair Value

Below Fair Value: RMD ($268.63) is trading above our estimate of fair value ($202.55)

Significantly Below Fair Value: RMD is trading above our estimate of fair value.


Price To Earnings Ratio

PE vs Industry: RMD is poor value based on its PE Ratio (85.3x) compared to the US Medical Equipment industry average (49x).

PE vs Market: RMD is poor value based on its PE Ratio (85.3x) compared to the US market (18.2x).


Price to Earnings Growth Ratio

PEG Ratio: RMD is poor value based on its PEG Ratio (3.9x)


Price to Book Ratio

PB vs Industry: RMD is overvalued based on its PB Ratio (14.4x) compared to the US Medical Equipment industry average (4.4x).


Future Growth

How is ResMed forecast to perform in the next 1 to 3 years based on estimates from 19 analysts?

21.6%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: RMD's forecast earnings growth (21.6% per year) is above the savings rate (2%).

Earnings vs Market: RMD's earnings (21.6% per year) are forecast to grow faster than the US market (15% per year).

High Growth Earnings: earnings are expected to grow significantly over the next 3 years.

Revenue vs Market: RMD's revenue (8.8% per year) is forecast to grow slower than the US market (9.2% per year).

High Growth Revenue: RMD's revenue (8.8% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: RMD's Return on Equity is forecast to be high in 3 years time (23.5%)


Past Performance

How has ResMed performed over the past 5 years?

14.4%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: RMD has high quality earnings.

Growing Profit Margin: RMD's current net profit margins (14.8%) are lower than last year (17.7%).


Past Earnings Growth Analysis

Earnings Trend: RMD's earnings have grown by 14.4% per year over the past 5 years.

Accelerating Growth: RMD's has had negative earnings growth over the past year, so it can't be compared to its 5-year average.

Earnings vs Industry: RMD had negative earnings growth (-10.8%) over the past year, making it difficult to compare to the Medical Equipment industry average (30.9%).


Return on Equity

High ROE: RMD's Return on Equity (16.9%) is considered low.


Financial Health

How is ResMed's financial position?


Financial Position Analysis

Short Term Liabilities: RMD's short term assets ($1.5B) exceed its short term liabilities ($876.5M).

Long Term Liabilities: RMD's short term assets ($1.5B) exceed its long term liabilities ($999.9M).


Debt to Equity History and Analysis

Debt Level: RMD's debt to equity ratio (27%) is considered satisfactory.

Reducing Debt: RMD's debt to equity ratio has increased from 26.5% to 27% over the past 5 years.

Debt Coverage: RMD's debt is well covered by operating cash flow (115%).

Interest Coverage: RMD's interest payments on its debt are well covered by EBIT (33.1x coverage).


Balance Sheet


Dividend

What is ResMed current dividend yield, its reliability and sustainability?

0.58%

Current Dividend Yield


Dividend Yield vs Market

Notable Dividend: RMD's dividend (0.58%) isn’t notable compared to the bottom 25% of dividend payers in the US market (1.32%).

High Dividend: RMD's dividend (0.58%) is low compared to the top 25% of dividend payers in the US market (3.55%).


Stability and Growth of Payments

Stable Dividend: RMD is not paying a notable dividend for the US market, therefore no need to check if payments are stable.

Growing Dividend: RMD is not paying a notable dividend for the US market, therefore no need to check if payments are increasing.


Current Payout to Shareholders

Dividend Coverage: RMD is not paying a notable dividend for the US market.


Future Payout to Shareholders

Future Dividend Coverage: No need to calculate the sustainability of RMD's dividend in 3 years as they are not forecast to pay a notable one for the US market.


Next Steps

Management

How experienced are the management team and are they aligned to shareholders interests?

8.4yrs

Average management tenure


CEO

Mick Farrell (49 yo)

8.42yrs

Tenure

US$10,429,750

Compensation

Mr. Michael J. Farrell, also known as Mick, BE, SM, MBA, serves as Member of Advisory Board at Green Sun Medical, LLC. He serves as the Chief Executive Officer of ResMed Pty Ltd. Mr. Farrell has been the C...


CEO Compensation Analysis

Compensation vs Market: Mick's total compensation ($USD10.43M) is about average for companies of similar size in the US market ($USD11.19M).

Compensation vs Earnings: Mick's compensation has been consistent with company performance over the past year.


Leadership Team

Experienced Management: RMD's management team is seasoned and experienced (8.4 years average tenure).


Board Members

Experienced Board: RMD's board of directors are considered experienced (7.7 years average tenure).


Ownership

Who are the major shareholders and have insiders been buying or selling?


Insider Trading Volume

Insider Buying: Insufficient data to determine if insiders have bought more shares than they have sold in the past 3 months.


Recent Insider Transactions

Ownership Breakdown

Dilution of Shares: Shareholders have not been meaningfully diluted in the past year.


Top Shareholders

Company Information

ResMed Inc.'s company bio, employee growth, exchange listings and data sources


Key Information

  • Name: ResMed Inc.
  • Ticker: RMD
  • Exchange: NYSE
  • Founded: 1989
  • Industry: Health Care Equipment
  • Sector: Healthcare
  • Market Cap: US$39.090b
  • Shares outstanding: 145.52m
  • Website: https://www.resmed.com

Number of Employees


Location

  • ResMed Inc.
  • 9001 Spectrum Center Boulevard
  • San Diego
  • California
  • 92123
  • United States

Listings


Biography

ResMed Inc. develops, manufactures, distributes, and markets medical devices and cloud-based software applications that diagnose, treat, and manage respiratory disorders comprising sleep apnea, chronic obs...


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2021/08/03 00:34
End of Day Share Price2021/08/02 00:00
Earnings2021/03/31
Annual Earnings2020/06/30


Unless specified all financial data is based on a yearly period but updated quarterly. This is known as Trailing Twelve Month (TTM) or Last Twelve Month (LTM) Data. Learn more here.