ResMed Inc. RMD
ResMed remains a buy based on FY2026 results (year ended 2026-06-30) showing revenue of $5.65B growing 9.85% YoY, operating margin expansion to 33.48%, and $1.65B in free cash flow at a 29.18% FCF margin. At 23.02x P/E — roughly a 28.5% discount to the peer median of 32.20x — and 15.94x EV/EBITDA versus the peer median of 17.48x, the stock offers compelling relative value for a franchise with expanding gross margins (61.16% versus 55.78% three years prior) and minimal leverage ($825.9M total debt against $6.59B equity).
The newly surfaced Pomerantz investigation and $35.3M of net insider selling over 24 months are watch items, but bullish technicals — the stock trading above its 50-day ($211.35) and 200-day ($228.82) moving averages with a positive MACD histogram — and growing institutional participation (61 funds as of the quarter ended 2026-06-30, up from ~51 a year earlier) support continued ownership.
What could go wrong
- Securities litigation overhang. Pomerantz LLP announced investigations into ResMed on Aug 25 and Aug 27, 2026; formalization into a class action could create sustained selling pressure and reputational drag.
- Near-term overbought conditions. RSI(14) at 68.95 as of 2026-08-28 approaches overbought territory; the stock sits ~$12 above its 200-day MA ($228.82), leaving it vulnerable to a mean-reversion pullback.
- Persistent insider selling. Over the trailing 24 months, insiders net sold approximately 94,807 shares for $35.3M, including CEO Michael Farrell routinely exercising options and selling same-day; no meaningful insider buying is evident.
- Smart money slightly negative. The smart money score is -0.0068 as of the quarter ended 2026-06-30, having deteriorated from +0.0318 in Sep 2025; institutional positioning has turned marginally cautious despite higher fund count.
What would change my mind
Where this comes from: FMP fundamentals + derived_metrics, FY2026 (period ended 2026-06-30) · peer_relative (as of 2026-08-28) · derived_metrics FY2026 vs FY2023 · FMP fundamentals, FY2026 (period ended 2026-06-30). Orin's read on RMD; not advice.
Twelve months actual closes to 2026-09-23 · actual filings
50-day average 200-day average · volume below
On file
All RMD filingsLargest holders · 13F Q2 2026
Money flow| Filer | Position | Of fund |
|---|---|---|
| Vanguard Capital Management | $1.8B | 0.0% of fund |
| Vanguard Portfolio Management | $1.5B | 0.1% of fund |
| State Street | $1.3B | 0.0% of fund |
| Geode Capital Management | $845.2M | 0.0% of fund |
| Bank of New York Mellon | $818.0M | 0.1% of fund |
| Invesco | $402.1M | 0.0% of fund |
81 filers · quarter ended Q2 2026 · positions, not flows
Insiders, last 24 months: 146 Form 4 filings, net −$36.6M. Of the 50 on hand, 0 were open-market purchases and 26 sales— the rest are grants, option exercises and tax withholding.
Ask Orin about RMD
Orin answers questions about RMD from its filings, transcripts and numbers — with the source behind every claim. Your own desk starts with 3 free days, card required.
Start 3 free days →Where it trades
| Metric | Now | Own median | Sector |
|---|---|---|---|
| P/E | 21.3× | 35.7× | 26.4× |
| EV/EBITDA | 14.7× | 24.6× | — |
| P/S | 5.70× | 7.59× | — |
| P/B | 4.9× | 7.8× | — |
Its P/E sits below all 5 of the last 5 years (−1.09σ from its own mean).
7.4%
free-cash-flow growth every year for 10 years, discounted at 10%, is what today’s price implies — starting from $1.6B of trailing free cash flow. It is an assumption the market is making, not a forecast Orin is making.
What Wall Street published
$243
$213 – $300 · +9% against today's price
- 14 buy or overweight
- 16 hold
- 5 underweight or sell
The analysts’ consensus and their own ratings, not Orin’s. A target is a twelve-month opinion published by the firm that wrote it.
Against the companies it is compared to
| Company | Market cap | P/E | EV/EBITDA | Gross | Net | ROE |
|---|---|---|---|---|---|---|
| RMDResMed Inc. | $32B | 21.3× | 14.7× | 61.2% | 26.9% | 24% |
| AAgilent Technologies, Inc. | $47B | 32.5× | 24.8× | 53.7% | 19.5% | 20% |
| BDXBecton, Dickinson and Company | $50B | 55.0× | 17.0× | 46.1% | 4.5% | 4% |
| CAHCardinal Health, Inc. | $52B | 30.4× | 16.4× | 3.8% | 0.7% | -60% |
| GEHCGE HealthCare Technologies Inc. | $30B | 19.0× | 10.9× | 42.9% | 7.9% | 15% |
| HUMHumana Inc. | $45B | 35.2× | 17.1× | 13.7% | 0.9% | 7% |
| IQVIQVIA Holdings Inc. | $44B | 32.9× | 16.6× | 26.2% | 8.1% | 22% |
| MTDMettler-Toledo International Inc. | $30B | 33.5× | 24.7× | 58.4% | 21.9% | -1200% |
The median is of the 7 peers listed above and nothing else — check it against the column. This company trades 35.4% below it. The peer set is the vendor’s, so a company can appear here that a person would not have chosen.
What it has traded at
What its sector has traded at
Two scales, drawn separately on purpose: a sector median and one company’s multiple are not the same number and putting them on one axis invites a comparison neither series supports.
Discounted cash flow
| Model | Fair value | Against | Computed |
|---|---|---|---|
| Standard DCF | $305 | $195.21 · +56% | 2026-06-10 |
| Levered DCF | $509 | $195.21 · +161% | 2026-06-10 |
The vendor’s intrinsic-value models. Treat them as a low-growth anchor — for a fast grower the market routinely pays well above a DCF. These were computed against the price in the “against” column, not today’s.
Every estimate on one scale
The vertical rule is the current price. Ranges and point estimates are the backend’s, published as they were calculated; an arrow means the estimate sits beyond this scale, and its number is on the right.