Morgans Sticks to Their Buy Rating for Resmed Inc CHESS Depositary Interests on a ratio of 10 CDIs per ord.sh (RMD)
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According to TipRanks, Jellinek is a 3-star analyst with an average return of 3.2% and a 44.74% success rate. Jellinek covers the Healthcare sector, focusing on stocks such as Ansell, Cochlear Limited, and CSL.
Currently, the analyst consensus on Resmed Inc CHESS Depositary Interests on a ratio of 10 CDIs per ord.sh is a Strong Buy with an average price target of A$43.80, which is a 25.14% upside from current levels. In a report released on April 24, J.P. Morgan also maintained a Buy rating on the stock with a A$45.00 price target.
The company has a one-year high of A$40.75 and a one-year low of A$27.13. Currently, Resmed Inc CHESS Depositary Interests on a ratio of 10 CDIs per ord.sh has an average volume of 1.47M.
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While Nvidia and AMD are trading close to all-time highs, we prefer a lesser-known (but still profitable) stock benefiting from the rise of AI. Click here to access our free report one of our favorites growth stories. Operating Margin ResMed has been an efficient company over the last five years. It was one of the more profitable businesses in the healthcare sector, boasting an average operating margin of 29%. Analyzing the trend in its profitability, ResMed's operating margin rose by 4.5 percentage points over the last five years, as its sales growth gave it operating leverage. This performance was mostly driven by its recent improvements as the company's margin has increased by 5.9 percentage points on a two-year basis. These data points are very encouraging and shows momentum is on its side. This quarter, ResMed generated an operating margin profit margin of 33.7%, up 2.6 percentage points year on year. This increase was a welcome development and shows it was more efficient. Earnings Per Share Revenue trends explain a company's historical growth, but the long-term change in earnings per share (EPS) points to the profitability of that growth – for example, a company could inflate its sales through excessive spending on advertising and promotions. ResMed's EPS grew at a spectacular 14.9% compounded annual growth rate over the last five years, higher than its 11.7% annualized revenue growth. This tells us the company became more profitable on a per-share basis as it expanded. We can take a deeper look into ResMed's earnings to better understand the drivers of its performance. As we mentioned earlier, ResMed's operating margin expanded by 4.5 percentage points over the last five years. This was the most relevant factor (aside from the revenue impact) behind its higher earnings; interest expenses and taxes can also affect EPS but don't tell us as much about a company's fundamentals. In Q2, ResMed reported adjusted EPS at $2.55, up from $2.08 in the same quarter last year. This print beat analysts' estimates by 3%. Over the next 12 months, Wall Street expects ResMed's full-year EPS of $9.55 to grow 8.6%. Key Takeaways from ResMed's Q2 Results It was good to see ResMed narrowly top analysts' revenue expectations this quarter. We were also happy its constant currency revenue narrowly outperformed Wall Street's estimates. Overall, this print had some key positives. The stock remained flat at $270.94 immediately following the results. So do we think ResMed is an attractive buy at the current price? What happened in the latest quarter matters, but not as much as longer-term business quality and valuation, when deciding whether to invest in this stock. We cover that in our actionable full research report which you can read here, it's free. 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