Position held
RMD
ResMed
- Return
- +6.29%
- Quantity
- 594
- Cost
- $214.83
- Price
- $228.35
- Opened
- 2026-07-07
- Value
- $135,640
A mask that has to be replaced, every night, for life.
ResMed sells the devices that treat sleep apnoea, and above all the masks that go with them. The machine is bought once; the mask is a consumable. Sleep apnoea is not cured — treatment is nightly and permanent — which turns an equipment sale into recurring revenue without a subscription contract. In fiscal 2026, masks and accessories grew 12% in constant currency, devices 7%.
Operating income reached $1,887M, on a 61.1% gross margin and a return on invested capital near 21%. On top sits a software layer — Brightree, MatrixCare, MEDIFOX DAN — sold to home-care providers, which makes ResMed harder to dislodge than the hardware alone would.
The threat is named in the company's own risk factors: GLP-1s. If losing weight becomes as routine as taking a statin, the obesity-driven apnoea population shrinks, and the mask stream with it. This is the most serious risk in our book, because it does not destroy the competitive advantage — it drains the market underneath it. We cut the position in August.
What would make us sell
We sell if Sleep and Breathing Health revenue grows less than 3% in constant currency for two consecutive quarters, or if management concedes that GLP-1 adoption is reducing diagnoses or mask replacement rates.