The thesis

ResMed operates in the medical devices segment with high gross margins of 61.16% and revenue growth of 8.6% YoY. The company's conviction score is 24/100, indicating a medium conviction level. Analyst consensus rating is HOLD, with a P/E of 21.1x. The high net margin of 26.94% suggests strong profitability.

Why now

The current macro context of tightening monetary policy and elevated energy prices may impact consumer discretionary spending, but ResMed's essential healthcare products may be less affected. The company's strong financials make it an interesting setup amidst sector risks.

What to watch

ResMed's next quarter revenue growth and margin reports will be crucial in confirming or denying the thesis. Any significant changes in analyst consensus ratings or conviction scores will also be important indicators.

Key risks

Valuation risk is present with a P/E of 21.1x, and execution risk is a concern given the need to maintain high margins and growth. Macro risk from tightening monetary policy could impact the broader healthcare sector.

Theme exposure