ResMed cut to Hold

When we raised ResMed’s buy price on 21 Nov 14 (Buy – $6.03), we noted that earnings would be helped by the Aussie dollar’s fall of almost 10% since June. Well a month later and the fall is up to 13%, which should add another 3–5% to earnings – yet the share price has celebrated with a rise of 13%. The increase has put the price-earnings ratio up from 20 to 22 and taken us well beyond our (new) Buy price of $6.50. As a result we’re moving back to Hold, at least until we see further evidence of the...

When we raised ResMed’s buy price on 21 Nov 14 (Buy – $6.03), we noted that earnings would be helped by the Aussie dollar’s fall of almost 10% since June. Well a month later and the fall is up to 13%, which should add another 3–5% to earnings – yet the share price has celebrated with a rise of 13%.

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