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.
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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.
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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
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