ResMed stock (NYSE: RMD), a respiratory care devices company, currently trades at $150 per share, 23% below the level seen in March 2021, and it has room for growth, in our view. RMD stock was trading at around $210 in early June 2022, just before the Fed started increasing rates, and is now nearly 30% below that level, compared to 14% gains for the S&P 500 during this period. The recent stock decline can partly be attributed to downbeat Q4 fiscal 2023 results (fiscal year ends in June).
Interestingly, RMD stock has had a Sharpe Ratio of 0.5 since early 2017, lower than 0.6 for the S&P 500 Index over the same period. This compares with the Sharpe of 1.3 for the Trefis Reinforced Value portfolio. Sharpe is a measure of return per unit of risk, and high-performance portfolios can provide the best of both worlds.
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