ResMed Inc. (NYSE:RMD) Offers a Compelling Dividend Profile Supported by Strong Profitability

Using a methodical system for dividend investing can help investors find companies that not only give regular income but also show financial steadiness and lasting business operations. The "Best Dividend Stocks" screen uses particular filters to find companies with good dividend features while keeping sufficient earnings and financial condition. This system concentrates on stocks with average daily trading volume above 500,000 shares, prices above $10, and ChartMill Health and Profitability Ratings of at least 5, while looking for companies with Dividend Ratings of 7 or more.

Dividend Profile Assessment

RESMED INC (NYSE:RMD) makes a strong case for dividend-focused investors, reaching a Dividend Rating of 7 out of 10. The company's dividend features show both dependability and the ability to continue, which are key for long-term dividend investors looking for regular income.

Key dividend numbers are:

• Current dividend yield of 0.96%
• Five-year average dividend growth rate of 6.33%
• Payout ratio of 22.31% of earnings
• Steady dividend payments for over 10 years with no cuts

While the absolute yield seems low next to the S&P 500 average of 2.40%, it is key to see that RMD does better than 93% of its healthcare equipment industry peers in dividend yield. The company's maintainable payout ratio and steady dividend growth record give confidence in the dependability of future payments, speaking to the main worry of dividend investors about payment continuity.

Profitability and Financial Health

The company's good profitability and financial condition ratings give extra confidence for dividend continuity. RMD gets high marks in both areas, with a Profitability Rating of 9 and Health Rating of 8, showing solid operational results and sound financial standing.

Profitability points:

• Return on Invested Capital of 20.50%, doing better than 98% of industry peers
• Operating margin of 33.49%, placed in the top 1% of the industry
• Steady positive earnings and cash flow over the last five years

Financial condition signs:

• Altman-Z score of 12.74, showing low bankruptcy risk
• Debt-to-equity ratio of 0.07, showing careful leverage
• Current ratio of 2.89, confirming good short-term cash availability

These numbers are especially important for dividend investors because companies with good profitability and financial condition are in a better position to keep and increase dividend payments through different economic times, lowering the chance of dividend cuts during difficult periods.

Growth and Valuation Context

RMD shows good growth features that help future dividend continuity. The company has reached:

• Revenue growth of 9.36% over the last year
• Five-year average revenue growth of 11.72%
• Earnings per share growth of 19.42% in the most recent year

From a valuation view, while the company trades at a P/E ratio of 25.22, roughly matching the S&P 500 average, it seems fairly valued within its industry, trading at a lower cost than 77% of healthcare equipment peers based on enterprise value to EBITDA. This even valuation, mixed with good growth outlooks, indicates possibility for both income and price growth.

The full fundamental analysis report gives more detailed views into RMD's financial position and dividend continuity numbers.

Investment Considerations

For dividend investors, RMD stands for a balanced chance that mixes medium current yield with good dividend growth possibility, supported by high profitability and financial condition. The company's low payout ratio gives plenty of room for future dividend raises, while its good market position in digital health and cloud-connected medical devices offers growth visibility.

The company's focus on respiratory disorder treatments and cloud-based software applications places it well in increasing healthcare markets, helping continued revenue and earnings growth that can pay for future dividend raises. This business steadiness is especially useful for dividend investors looking for dependable income streams.

Investors curious about finding similar dividend chances can access the full Best Dividend Stocks screen to look over other companies meeting these strict rules.

Disclaimer: This analysis is based on fundamental data and screening rules described here and is meant for information only. It does not make up investment advice, and investors should do their own research and think about their personal financial situations before making investment choices. Past results do not ensure future outcomes, and dividend payments depend on company decisions and market situations.