ASX:RMD

ResMed is under Algo Engine buy conditions and is a current holding in our ASX model portfolio.

Resmed reported better than expected 1Q21 earnings with group revenue up 10% and NPAT up 37% on the same time last year.

At 35x PE Resmed remains expensive and will need to maintain double-digit earnings growth to sustain the current valuation.

Buy on future share price weakness.

ResMed is under Algo Engine buy conditions and is a current holding in our ASX top 100 model portfolio.

RMD announced 4Q20 earnings, which were better-than-expected, underpinned by robust COVID-19 ventilator demand. However, modest revenue growth is expected in the near-term, implying limited near-term growth.

The 40x PE multiple looks too rich for the current earnings outlook. The forward dividend yield is 1%.

We suggest waiting for the next Algo buy signal to re-enter RMD on a pullback. Our new entry target is $22.

ResMed short term traders may wish to take profit on RMD, following the 6% rally. 

ResMed is under Algo Engine buy conditions and we see buying support building.

Accumulate RMD within the $22 – $23 price range.

ResMed is a current holding in our ASX 100 model portfolio.

The company reports 1Q20 earnings on 25 October and we expect revenue growth to be 15%+ and EBIT to be up 10%+ on the same time last year.

We look for an entry-level into RMD on the current price weakness and will update our readers further, following the earnings result.

ResMed is under Algo Engine buy conditions and is a current holding in our ASX 100 model portfolio.

RMD report earnings on the 24th Oct and the market is looking for 10%+ in EPS growth. We expect buying support to increase ahead of the result and see support building at $19.50.

ResMed is under Algo Engine buy conditions and is a current holding in our ASX 100 model portfolio.

Buying interest is again building near the $14.00 price range.

We recommend adding Resmed to your watch list.

RMDis a global company involved in the development and manufacturing of medical products for the treatment of respiratory disorders.  Global mask sales increased 10%+ on the same time last year.

Low returns from new acquisitions, disappointed investors and the soft 2Q19 earnings update resulted in the stock falling by over 10%

It’s difficult to say with certainly where buyers will step back in, but we are confident of the long-term story with Resmed.

The chart below illustrates the lower band where we see deep value for investors willing to take a 1 – 3 year outlook.

RMD has rallied from $13.75 to $14.75 following last weeks reported strong 1Q19 result, which included EBIT +28% on the same time last year.

The company also delivered robust top-line growth, which came in ahead of market expectations. Gross margins held at 58+%.

We anticipate EPS growing from US$3.70 in FY19 to US$4.50 in FY21 and revenue growing from US$2.9 billion to US$3.5 billion over the same period.

Resmed

Resmed  should continue to deliver 10% EPS growth per year over the next 2 – 3 years.

However, at 27x F19 earnings and 1.5% yield, the stock looks expensive.

Other names within the Healthcare space such as CSL at 32x and COH at 38x FY19 also, look expensive.

With the above in mind, our base case is that the sector trades sideways and investors should add a covered call option to enhance the returns.

Resmed