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Date : 06/08/2021

ResMed Shares on Watchlist After Impressive FY21 Updates

The California based medical equipment manufacturing company also now offers a cloud-based software for diagnosis and treatment without the need for a hospital. Telemedicine and out-of-hospital healthcare looks to be booming and the pandemic has accelerated this shift. As a result, ResMed has benefitted and is aiming to serve 250 million patients through its products by 2025. An ambitious growth strategy that is well within reach for the company. Both sleep & respiratory care, and their SaaS offering has seen steady growth in the past few years and our estimates point towards ResMed being a good investment in the long-term.

Why ResMed Shares Performed Well With FY21 Results?

The RMD share price has been a top performer since June. RMD shares were initially on a downward trend this year, however, the stock price has gained over 47% in the past 3 months. This morning, RMD shares continued to perform in the green territory as the company announced their Q4 results for FY20. Some of the highlights from the result are:

  • Revenue increased by 14% to $876.1 million; up 10% on a constant currency basis
  • Gross margin of 56.0%; non-GAAP gross margin contracted 260 bps to 57.3%
  • Income from operations increased 8%; non-GAAP operating profit up 7%
  • Diluted earnings per share of $1.33; non-GAAP diluted earnings per share of $1.35
  • Quarterly dividend increased by 8% to $0.42 per shares

Our fourth quarter and full-year fiscal year 2021 results continue to demonstrate the strength and resiliency of our business,” said Mick Farrell, ResMed’s CEO. “During the quarter, we saw the ongoing recovery of core sleep apnea and COPD patient flow across our business, as healthcare systems continue to adopt new models of patient care. We faced some headwinds this quarter, as we annualized the $125 million in COVID-related ventilator sales from this period in 2020, and we saw some tailwinds from a competitor’s major quality issue that was announced during the quarter. The net result was strong revenue growth of 10% for our ResMed business in the June quarter. We finished the full fiscal year 2021 with 6% revenue growth year-over-year to $3.2 billion, with operating profit up 12% on a non-GAAP basis.

The world leading digital health company has been performing exceptionally well and it looks like this is going to continue. RMD shares have also been in favour as a result of this operational performance and it is definitely worth considering as a long-term investment. At market close today, RMD shares ended the day in green at $37.27 a share – up 0.24%.

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