Is it Worth Adding ResMed Stock to Your Portfolio Now?

Core Viewpoint - ResMed Inc. (RMD) has demonstrated significant growth in the second quarter of fiscal 2025, primarily driven by its Mask business and Device sales, while the SaaS business is expanding through strategic acquisitions. However, the company's increasing debt levels pose a concern [1][10]. Group 1: Financial Performance - ResMed's market capitalization stands at $32.87 billion, with an earnings yield of 4.2%, outperforming the industry's 1.5% [2]. - The company has consistently exceeded earnings estimates over the past four quarters, achieving an average surprise of 6.86% [2]. - The Zacks Consensus Estimate for fiscal 2025 earnings has increased by 0.3% to$ 9.47 per share, with projected revenues of $5.11 billion, indicating a 9% year-over-year increase [11]. Group 2: Business Segments - Device sales have shown a recovery, with global sales increasing by 11%, supported by the strong performance of the AirSense 10 and AirSense 11 platforms [3][4]. - The SaaS business has reported an 8% year-over-year growth, driven by strategic acquisitions like MEDIFOX DAN, which has exceeded initial expectations [6][5]. - The Mask business has also seen an 11% increase in revenues, benefiting from strong demand and product development, including the introduction of new mask ranges [8][9]. Group 3: Strategic Initiatives - ResMed is focused on expanding the availability of the AirSense 11 platform globally by obtaining regulatory clearances in various markets, with a recent launch in India [4]. - The company is enhancing its Brightree reSupply program and aims for sustainable organic growth across its SaaS solutions, including home health and nursing [7]. Group 4: Challenges - As of September 30, 2024, ResMed's long-term debt was$ 663 million, while cash and cash equivalents were only $522 million, raising concerns about the sustainability of its debt levels [10].