AUS
NZ
UK
CA
USA
FRA
GER
ESP
ITA
NLD
PRT
SWE
GRC
IND
POL
BRA
ZAF
RUS
CHN
UAE
The Wesfarmers Ltd share price has surged 23.5% since the start of 2024. Meanwhile, ResMed CDI shares are currently just 4% shy of their 52-week high. These movements suggest that both companies are worth keeping an eye on.
Wesfarmers Ltd (ASX:WES)
Founded in 1914 and headquartered in Perth, Wesfarmers is a major Australian conglomerate with interests across retail, chemicals, fertilizers, industrial, and safety products. Known for its strategic acquisitions and divestments, Wesfarmers has a reputation similar to that of a publicly listed private equity firm.
A prime example is its history with Coles Group, which was acquired in 2007 and spun out in 2018. However, more than 50% of Wesfarmers' operating profit comes from Bunnings, Australia's leading hardware and home improvement retailer. Wesfarmers purchased the remaining 52% of Bunnings it did not already own in 1994 for $594 million. The company’s portfolio also includes brands like Kmart, Target, Officeworks, Blackwoods, and Priceline Pharmacy.
Wesfarmers is widely regarded as a blue-chip stock, valued for its quality assets and consistent dividend payouts. For FY23, Wesfarmers reported a return on invested capital (ROIC) of 19.00% and a revenue growth rate of 12.2% in recent years. A ROIC above 10% indicates strong performance, especially for a mature business, suggesting that Wesfarmers is effectively managing its investments and resources.
ResMed CDI (ASX:RMD)
Founded in 1989 and now based in San Diego, ResMed is a global leader in medical equipment, particularly known for its cloud-connected continuous positive airway pressure (CPAP) machines used to treat obstructive sleep apnea (OSA). ResMed’s shares are traded as CHESS Depositary Interests (CDIs) on the ASX, with its primary listing on the NYSE.
Operating in over 140 countries with a workforce of more than 10,000, ResMed has two main business units: Sleep and Respiratory Care, and Software as a Service (SaaS). The Sleep and Respiratory Care unit offers advanced CPAP machines and ventilation solutions for patients with varying needs, from nightly therapy to life-support systems. The SaaS unit supports durable and home medical equipment, enhancing out-of-hospital care through digital health networks.
ResMed’s integration of its industry-leading hardware with its digital health platform allows the company to drive insights, improve patient outcomes, and reduce healthcare costs.
For Wesfarmers Ltd, the current dividend yield stands at around 2.69%, below its 5-year average of 3.84%. This indicates that while Wesfarmers continues to provide consistent returns, its shares are currently trading at a lower yield compared to historical averages.
Wesfarmers and ResMed are noteworthy ASX stocks due to their recent performance and strong fundamentals. Investors may find these companies interesting as they navigate their respective sectors and financial landscapes.
