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ResMed Inc. (RMD)

Company Dividend Discount ModelIndustry: Medical - Instruments & SuppliesSector: Healthcare

Valuation Snapshot

Stable Growth$229.11 - $607.75$350.33
Multi-Stage$156.46 - $170.96$163.58
Blended Fair Value$256.95
Current Price$273.73
Upside-6.13%
DecisionDon't Buy

Dividend History & Growth Metrics (10Y)

Metric5Y CAGR10Y CAGR2025202420232022202120202019201820172016
DPS6.67%7.05%2.111.921.751.671.541.531.441.361.271.14
YoY Growth--10.12%9.31%5.27%8.22%0.72%6.32%6.12%7.06%10.83%6.91%
Dividend Yield--0.77%0.79%1.19%0.76%0.58%0.89%1.06%1.18%1.64%1.76%

Stable Growth Model (Adjusted)

(USD in Millions except Per Share Data)
Net Income To Common (M)1,437.90
(-) Cash Dividends Paid (M)320.74
(=) Cash Retained (M)1,117.17
MetricLOWBASEHIGH
Required Retention Ratio20.0%12.5%7.5%
(=) Cash Required (M)287.58179.74107.84
Cash Retained (M)1,117.171,117.171,117.17
(-) Cash Required (M)-287.58-179.74-107.84
(=) Excess Retained (M)829.58937.431,009.32
(/) Shares Outstanding (M)147.22147.22147.22
(=) Excess Retained per Share5.636.376.86
LTM Dividend per Share2.182.182.18
(+) Excess Retained per Share5.636.376.86
(=) Adjusted Dividend7.818.559.03
WACC / Discount Rate9.10%9.10%9.10%
Growth Rate5.50%6.50%7.50%
Fair Value$229.11$350.33$607.75
Upside / Downside-16.30%27.98%122.03%

Multi-Stage Model: Projections

(USD in Millions)
MetricTTMDec-27Dec-28Dec-29Dec-30Dec-31Terminal
Net Income (M)1,437.901,531.371,630.911,736.921,849.821,970.052,029.15
Payout Ratio22.31%35.84%49.38%62.92%76.46%90.00%92.50%
Projected Dividends (M)320.74548.92805.401,092.911,414.391,773.051,876.97

Multi-Stage Valuation

MetricLOWBASEHIGH
WACC / Discount Rate9.10%9.10%9.10%
Growth Rate5.50%6.50%7.50%
Year 1 PV (M)498.42503.14507.86
Year 2 PV (M)664.02676.67689.44
Year 3 PV (M)818.17841.65865.59
Year 4 PV (M)961.42998.391,036.42
Year 5 PV (M)1,094.341,147.191,202.07
PV of Terminal Value (M)18,997.6519,915.2420,867.95
Equity Value (M)23,034.0124,082.2925,169.34
Shares Outstanding (M)147.22147.22147.22
Fair Value$156.46$163.58$170.96
Upside / Downside-42.84%-40.24%-37.54%

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