I said earlier today in my report on the $RMD's latest quarterly, that there are several factors driving a now quite wide gap between most reasonable valuations of $RMD (anywhere from $35 to $50 IMHO).

So here I will lay out the the various elements of the Bear Thesis:

In the chart below I am referring to the US listing in USD. (There are 10 ASX CDIs per share, and then there is the Fx correction ... $0.7150 today)

The recent divergence is quite striking, as the chart below shows - hardly unprecedented, but getting there.

RMD hit an all-time closing high of $292.36 on August 22, 2025, and the stock is now around $213, implying a ~27% fall from peak. As of April 30 (results day), RMD was trading at ~$213.81 at close, hitting a fresh 52-week low intraday of $210.60. This is against an analyst consensus price target of ~$295, a ~38% gap. Several forces appear to be driving this:

1. GLP-1 / Ozempic overhang (structural fear) The most persistent headwind. Investors are concerned that GLP-1 obesity medications will cost RMD revenue, given obesity is a common precursor to OSA. Brokers argue investors don't appreciate the scale of the remaining sleep apnea market even if GLP-1s reduce obesity prevalence. This fear has been recurring since 2023 and clearly hasn't dissipated despite RMD continuing to deliver strong results. You can contrast this with the clinical data that Mick Farrell updates at each $RMD results session. At some point, something has to give?

2. Philips re-entry risk Morgan Stanley noted the current share price reflects bear-case assumptions within its Philips scenario analysis, which assumes Philips re-enters the U.S. device market in 2026 with a price discount and increased SG&A for ResMed. Philips' CPAP recall from 2021 handed RMD enormous market share gains. The market is now pricing in some reversal of that windfall.

3. Respiratory segment guidance cut Management revised its FY26 growth outlook for the respiratory segment down to mid-single digits from upper mid-single digits, signalling a slowdown in expected growth. This spooked some investors despite the core sleep business performing well.

4. Broader healthcare sector pressure The broader US healthcare sector has been under pressure in 2026 from Medicaid cut fears, DOGE-esque budget uncertainty, and tariff concerns on medical device supply chains, all weighing on sentiment across the sector regardless of company-specific fundamentals.

5. CEO insider selling CEO Michael Farrell sold shares worth ~$1.25 million in March 2026, which contributed to a 2.6% single-day fall, even though the transaction was under a pre-arranged trading plan. Mick regularly sells down, but the share sales are only ever a small proportion of his holding.

6. Results not acting as a catalyst Even after the Q2 FY26 beat in late January/early February — where EPS of $2.81 exceeded the $2.73 forecast — the stock dipped 0.51% in aftermarket trading. This "beat and dip" pattern suggests the market has been de-rating the stock on valuation multiples rather than responding to earnings momentum, reflecting the weight of the structural concerns above.

The core paradox is that RMD keeps delivering operationally (11% revenue growth, 290 bps margin expansion, strong cash conversion) yet the stock keeps making new lows. That kind of persistent disconnect between fundamentals and price action typically resolves one of two ways: either the bear thesis eventually proves correct, or the stock re-rates sharply once the overhang clears. Today's Q3 result, while solid, doesn't obviously provide the definitive GLP-1 or Philips clarity that would trigger the latter.

And so, as ever, it comes down to what do you believe about the future?

At today's forward P/E of 20'ish, I believe $RMD is a great investment. In fact, I'll be spending time over the weekend looking across my portfolio to consider should I own more?