We wrote about ResMed (RMD) a few months ago in Livewire, warning of the downside
Michael Gable
Fairmont Equities
We wrote about ResMed (RMD) a few months ago in Livewire, warning of the downside. Patience has paid off for our readers and it has now become a buying opportunity. A quick summary of the fundamentals: 1. Leveraged to sleeping disorder volumes due to higher obesity rates in developed nations. 2. High product gross margins (> 60%). 3. Returns above the cost of capital (ROA > 15%). 4. Trading on a comparatively cheap multiple of 16.8x forward earnings. In terms of the charts, we have finally seen RMD break the shorter term downtrend last week. Now that it has been broken, it should resume the longer term uptrend, which implies levels up towards $6. Before then, we expect some strong resistance between $5.60 - $5.80.
Never miss an update
Enjoy this wire? Hit the ‘like’ button to let us know.
Stay up to date with my current content by
following me below and you’ll be notified every time I post a wire
Michael Gable is managing director of Fairmont Equities. We are a small boutique advisory that uniquely combines both fundamental and technical analysis. As a result, our analysis is featured regularly in the finance media such as the Australian Financial Review, and Sky News Business.
Fairmont Equities provides portfolio management services and also produces weekly investment and trading ideas.
Sign up to our weekly newsletter containing stock tips and educational articles. Head to www.fairmontequities.com and leave your email to sign up now.
1 topic
Michael Gable
Managing Director
Fairmont Equities
Michael Gable is managing director of Fairmont Equities. We are a small boutique advisory that uniquely combines both fundamental and technical analysis. As a result, our analysis is featured regularly in the finance media such as the Australian...
Expertise
No areas of expertise
Michael Gable
Managing Director
Fairmont Equities
Michael Gable is managing director of Fairmont Equities. We are a small boutique advisory that uniquely combines both fundamental and technical analysis. As a result, our analysis is featured regularly in the finance media such as the Australian...
Expertise
No areas of expertise
Comments
Comments
Sign In or Join Free to comment
most popular
Equities
The 7 zombie companies lurking on the ASX 300
Livewire Markets
Education
Warren Buffett’s 25 biggest mistakes – and 4 lessons they teach
Leithner & Company Ltd