Stock of the Day

February 12, 2020

ResMed (RMD)

$251.67
+$1.98 (+0.8%)
Market Cap: $36.90B

About ResMed

ResMed Inc. develops, manufactures, distributes, and markets medical devices and cloud-based software applications for the healthcare markets. The company operates in two segments, Sleep and Respiratory Care, and Software as a Service. It offers various products and solutions for a range of respiratory disorders, including ApneaLink Air, a portable diagnostic device that measures oximetry, respiratory effort, pulse, nasal flow, and snoring; and NightOwl, a portable, cloud-connected, and disposable diagnostic device that measures AHI based on derived peripheral arterial tone, actigraphy, and oximetry over several nights. The company also provides AirView, a cloud-based system that enables remote monitoring and changing of patients' device settings; myAir, a personalized therapy management application for patients with sleep apnea that provides support, education, and troubleshooting tools for increased patient engagement and improved compliance; U-Sleep, a compliance monitoring solution that enables home medical equipment (HME) to streamline their sleep programs; connectivity module and propeller solutions; and Propeller portal. It offers out-of-hospital software solution, such as Brightree business management software and service solutions to providers of HME, pharmacy, home infusion, orthotics, and prosthetics services; MatrixCare care management and related ancillary solutions to senior living, skilled nursing, life plan communities, home health, home care, and hospice organizations, as well as related accountable care organizations; HEALTHCAREfirst that offers electronic health record, software, billing and coding services, and analytics for home health and hospice agencies; and MEDIFOX DAN's software solutions. The company markets its products to sleep clinics, home healthcare dealers, and hospitals through a network of distributors and direct sales force. ResMed Inc. was founded in 1989 and is headquartered in San Diego, California.

ResMed Bull Case

Here are some ways that investors could benefit from investing in ResMed Inc.:

  • The current stock price is around $240, which may present a buying opportunity for investors looking for growth in the healthcare sector.
  • ResMed Inc. has a solid annualized dividend of $2.12, providing a dividend yield of 0.87%, which can be attractive for income-focused investors.
  • The company maintains a low dividend payout ratio of 23.79%, indicating that it retains a significant portion of its earnings for reinvestment, which could support future growth.
  • Recent upgrades from analysts, including a shift from "neutral" to "buy" ratings, suggest positive sentiment and potential for stock appreciation.
  • ResMed Inc. operates in the growing healthcare market, focusing on innovative medical devices and cloud-based software, positioning itself well for future demand.

ResMed Bear Case

Investors should be bearish about investing in ResMed Inc. for these reasons:

  • Insider selling has been significant, with over 50,000 shares sold recently, which may indicate a lack of confidence among company executives.
  • Some analysts have downgraded their target prices for the stock, reflecting concerns about its near-term performance and market conditions.
  • The stock has experienced fluctuations, and the current price may not reflect its long-term potential, leading to uncertainty for investors.
  • With a consensus rating of "Moderate Buy," there is a mix of opinions among analysts, which could signal volatility in investor sentiment.
  • ResMed Inc. faces competition in the healthcare market, which could impact its market share and profitability in the future.
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