XRO share price in focus
Founded in 2006 in Wellington, New Zealand, by Rod Drury, Xero has grown into a global leader in cloud-based accounting software. Under Drury’s leadership until 2018 and under a new CEO since, the company has expanded to employ over 3,000 people and now serves millions of subscribers worldwide.
Xero’s “beautiful accounting software” is designed primarily for accountants and bookkeepers, enabling them to better serve small business clients. It offers real-time financial data accessible on any device, empowering small business owners and their advisors with up-to-date insights.
Xero’s core cloud accounting platform is widely used in New Zealand, Australia, the UK, and, to a lesser extent, the United States.
RMD shares
ResMed is a medical equipment company based in San Diego, California, but originally founded in Australia by Peter Farrell. The company provides cloud-connectable continuous positive airway pressure, or CPAP, machines for the treatment of obstructive sleep apnea (OSA). ResMed shares a listed both on the NYSE and the ASX. Because the primary listing is in the US, the market announcements and reports might look a bit different to other Australian companies as they follow the US format.
ResMed is a global company with 10,000+ employees and a presence in over 140 countries. It has two primary business units: Sleep and Respiratory Care, and Software as a Service (SaaS). The industry-leading CPAP machines for sleep apnea are provided under the Sleep and Respiratory Care business. This covers patients ranging from those who only require therapy from CPAP systems at night to those who are dependent on non-invasive or invasive ventilation for life-support. Within the SaaS unit ResMed provides software that assists durable or home medical equipment (DME/HME). Basically, it assists in out-of-hospital care.
ResMed leverages its industry-leading hardware (e.g. masks and humidifiers) and its SaaS data to drive insights, improve outcomes and reduce overall healthcare costs.
XRO share price valuation
As a growth company, some of the trends we might investigate from XRO include revenue growth, profit growth, and return on equity (ROE). These measures can indicate the growth rates and prospects of the company, as well as their ability to generate returns from their assets.
Since 2021, XRO has grown revenue at a rate of 26.4% per year to reach $1,714m in FY24. Over the same stretch of time, net profit has increased from -$9m to $175m. XRO last reported a ROE of 14.3%.
Over the last 3 years, RMD has increased revenue at a rate of 13.6% per year to hit $4,685m in FY24. Meanwhile, net profit has increased from $475m to $1,021m. RMD’s last reported ROE was 22.7%.
Please keep in mind that context is important – these metrics give us some indication of company performance, but it’s just the start of valuing XRO or RMD shares. To learn more about valuation, check out one of our free online investing courses.
