About: ResMed develops, manufactures, and markets medical equipment for the treatment of sleep disordered breathing. The Company sells diagnostic and treatment devices in various countries through its subsidiaries and independent distributors..

Why it is in the portfolio: Resmed, a bit like CSL, has been one of Australia's most successful national champions and consistent growers (revenue and earnings have grown at a steady 13-15% per year for 15 years or more - throughout the GFC.

Fundamentals: With a price/earnings multiple of 30 times next years estimated earnings it is not cheap on face value but by the same token if it continues to grow like it has it is fairly cheap and in fact could still make money for investors with a much lower growth rate.

What could go wrong: However, the main risk with ResMed, besides competition from better technology, is an unexpected fall in earnings and/or product recall, even if short-lived. Stocks like CSL, Cochlear and Resmed have delivered everything investors have asked for and in this environment, where such 'quality' is highly valued, a slipped halo can prove costly.