AUS
NZ
UK
CA
USA
IND
_08_21_2024_02_58_50_055769.jpg)
Two ASX giants have recently caught the eye of investors: Wesfarmers Ltd , which has surged nearly 30% this year, and ResMed CDI, rebounding strongly from its 52-week lows. This article delves into the reasons behind their impressive share price movements and their current market positions.
Wesfarmers Ltd (ASX:WES)
Wesfarmers Ltd has experienced a significant rise in its share price, up by 29.5% since the beginning of 2024. Founded in 1914 and headquartered in Perth, Wesfarmers is a prominent Australian conglomerate with operations spanning retail, chemicals, fertilizers, industrial products, and safety equipment across Australia and New Zealand.
Wesfarmers operates similarly to a publicly listed private equity firm, with a history of acquiring, optimizing, and then divesting businesses to capitalize on their value. A notable example is Coles Group, which Wesfarmers acquired in 2007 and later spun off in 2018. The company's largest revenue contributor, making up over 50% of its operating profit, is Bunnings, Australia’s leading hardware and home improvement retailer. Wesfarmers initially invested in Bunnings in 1987 and acquired full ownership in 1994 for $594 million.
Besides Bunnings, Wesfarmers owns several well-known brands including Blackwoods, Kmart, Target, Officeworks, and Priceline Pharmacy. Known for its stability and consistent dividend payouts, Wesfarmers remains a major player in the ASX index.
ResMed CDI (ASX:RMD) Performance
ResMed CDI has also shown impressive performance, with its share price rising 61.4% from its 52-week lows. Established in 1989 by Peter Farrell and headquartered in San Diego, California, ResMed specializes in medical equipment, particularly continuous positive airway pressure (CPAP) machines for the treatment of obstructive sleep apnea (OSA). While its primary listing is on the NYSE, ResMed is also listed on the ASX.
ResMed operates globally, with over 10,000 employees and a presence in more than 140 countries. The company is divided into two main business units: Sleep and Respiratory Care, and Software as a Service (SaaS). The Sleep and Respiratory Care unit offers CPAP machines and other solutions for patients with sleep apnea and respiratory conditions, while the SaaS unit provides software solutions for managing durable medical equipment and home care services.
For investors looking at Wesfarmers Ltd (ASX:WES), one way to assess its share price is through its dividend yield. Currently, Wesfarmers shares offer a dividend yield of approximately 2.57%, which is below its 5-year average of 3.24%. This indicates that the shares are trading below their historical average dividend yield, potentially offering insights into their current valuation.
Both Wesfarmers and ResMed have demonstrated strong performance and resilience in their respective sectors. For those monitoring the ASX, these companies reflect significant movements in share prices and offer insights into market trends and valuation.
