RESMED FH24 RESULT COMMENT

 RESMED FH24

As part of a discipline to write a note on each of my top 10 holdings when they report plus new holdings, maybe that will reduce turnover, lol

RMD reported strong revenue growth 145 about 10% without acquisitions. GM looks to have stabilised and maybe bottomed which has been a focus of the market for some time. Management is positive about the GM going forward.

ND/EBITDA is estimated at 0.7X so RMD is rapidly de-gearing which has been a hallmark of the company due to strong cash flows.

ASP was positive and given the reluctance of RMD to increase prices I can assume they are happy with the position versus the competition, Philips still making slow progress. RMD believe they are maintaining or gaining share across the board.

Cost cutting led to a restructuring charge.

The big news was that RMD disclosed that on a sample of 529k customers they were seeing a positive correlation between weight loss drugs and continued + use and + take-up of cpap. If this thesis holds then a positive rating will likely occur.

As well as the potential positive news on GLP-1 correlations is that RMD believes with AAPL and GOOGL etc increasing sleep health awareness on their devices a tailwind of demand could develop. The untapped market is believed to be large.

At this stage, my valuation at $26.40 sees 8% cagr given 5y 11% eps growth assumed and an end PE of 25X. Of course, that end PE could be higher. Completely extinguishes value around $40.



Please note the disclaimer.


Comments

Post a Comment

Popular posts from this blog

Performance Review FY2024--

  REVIEW OF PERFORMANCE fy2024 The numbers are in for 2024. The portfolio generated 20.8% (after costs and some cash taxes [1] ), the benchmark return was 13.4%. I am satisfied with the result, considering all things. What are all things? Was I in the fortunate receipt of much good luck (or bad luck), or did I utilise much higher risk in a rising market? Did style assist me? Does the result differ from what could be considered a random outcome (that is the hardest to assess)? I will attempt to address some of these in the following text. The following post will be divided into several sections addressing various segments. To reiterate my investment philosophy is to buy quality companies when they are reasonably priced. Of course, this sets a conscious boundary on likely results, up and down. I am consciously setting a limit on risk by skewing the portfolio almost totally to quality growth companies with a long history of profitable businesses. The belief is that over the long...
Read more

INVESTMENT CHECKLIST

  CHECKLIST FOR INVESTMENTS Overall I want this to be short enough so that I will use it and long enough to be useful. not War and Peace. In deference to Charlie Munger who continually suggested using a checklist, well I am getting on! Can be built up and on over time. Understandable business Do you understand the positioning of the business versus its competitors, customers and suppliers? What are the critical products, services and relationships? Is the size of the market(s) able to be estimated? Are there existential risks to the business, structural decline, or obsolescence? Operating History EPS growth, consistency/volatility is it forecastable? ROE/GM stability and level. Ability to manage margins. Total asset growth can the business profitably deploy assets. What has the reinvestment rate been? NPM level and stability. Does the business generate FCF, does CF reconcile to earnings? Given the above has the company favourable LT prospects? Management Condu...
Read more

Post Results--Examining the tail--PXA MIN CKF DMP SHL IEL DDR

  EXAMINING THE TAIL—PXA DMP RMD IEL DDR SHL MIN Almost all of my top 10 holdings are clear of significant issues with maybe valuation being the main point of conjecture. These investments represent a large proportion of the funds deployed. There is also a tail these are small or middling positions as launching pads to potential further investment but with current issues that may preclude investors from becoming overly excited about them. Therefore, they have potential attractive upsides. The underlying business should be sound and the issues short term. These holdings can be upscaled if the issues are indeed ST, however, not all will turn out favourably. How are these going? This is not an in-depth analysis but an overview of the short-term issues, are these issues becoming better or worse? Pexa (PXA) My thesis here rests with the Australian business being a natural monopoly, that appears intact. Secondly, Australian success can be repeated in the UK. Success in the UK rem...
Read more