ResMed Inc (RMD, Financial) has recently captured the attention of investors and financial analysts with its strong financial performance. Despite a daily loss of 1.69%, the stock has shown a positive change of 0.97% over the past three months, with a current share price of $219.87. A detailed analysis, supported by the GF Score, indicates that ResMed Inc is poised for significant growth, making it a compelling choice for investors.
What Is the GF Score?
The GF Score is a proprietary ranking system from GuruFocus, designed to predict stock performance by evaluating five key aspects of a company's financials. This system, which ranges from 0 to 100, has proven its effectiveness in forecasting long-term stock returns from 2006 to 2021. A higher GF Score correlates with greater potential returns. ResMed Inc boasts a GF Score of 97 out of 100, indicating a strong potential for market outperformance.
- Financial strength rank: 8/10
- Profitability rank: 10/10
- Growth rank: 10/10
- GF Value rank: 9/10
- Momentum rank: 5/10
Understanding ResMed Inc's Business
ResMed Inc, with a market cap of $32.3 billion and annual sales of $4.58 billion, is a leading global provider in the respiratory care device sector. The company's operating margin stands impressively at 29.54%. ResMed's focus on digital health solutions in the out-of-hospital setting differentiates it in the market, catering to a growing demographic affected by sleep apnea, aging, and obesity. The company's strategic acquisitions enhance its broad market presence, particularly in the Americas, Europe, Japan, and Australia.
Financial Strength Breakdown
ResMed Inc's financial robustness is evident through its Interest Coverage ratio of 30.28, significantly surpassing Benjamin Graham's recommended threshold of 5. This indicates a strong ability to meet interest obligations. Additionally, the Altman Z-Score of 12.4 suggests a low probability of financial distress. The strategic management of its debt, with a Debt-to-Revenue ratio of 0.19, further underscores its financial health.
Profitability and Growth Metrics
ResMed Inc's profitability is top-notch, with an Operating Margin that has consistently improved over the past five years, reaching 29.54% in 2024. The company's Predictability Rank of 4.5 stars reflects its stable operational performance. Growth-wise, ResMed Inc has excelled with a 13.3% 3-Year Revenue Growth Rate, outperforming 62.35% of its industry peers. The EBITDA growth rates over three and five years further highlight its expanding capabilities.
Conclusion
Considering ResMed Inc's strong financial strength, impressive profitability, and consistent growth metrics, the GF Score effectively highlights the company's superior position for potential market outperformance. Investors looking for similar opportunities can explore more companies with strong GF Scores through the GF Score Screen.
This article, generated by GuruFocus, is designed to provide general insights and is not tailored financial advice. Our commentary is rooted in historical data and analyst projections, utilizing an impartial methodology, and is not intended to serve as specific investment guidance. It does not formulate a recommendation to purchase or divest any stock and does not consider individual investment objectives or financial circumstances. Our objective is to deliver long-term, fundamental data-driven analysis. Be aware that our analysis might not incorporate the most recent, price-sensitive company announcements or qualitative information. GuruFocus holds no position in the stocks mentioned herein.
