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DexCom Inc DXCM

Morningstar Rating
$122.30 +0.56 (0.46%)
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Company Report

Dexcom Earnings: Ongoing Adoption of G7 and Favorable Reimbursement Suggest Strong 2024

Dexcom’s strong fourth-quarter performance wrapped up a solid year that slightly exceeded our expectations. However, our mild adjustments weren’t enough to shift our $105 fair value estimate. Organic quarterly revenue rose 26%, and Dexcom’s full-year 24% sales growth hit our estimate on the nose. The firm also eked out roughly 90 basis points of combined improvement in costs of goods sold and sales and marketing expenses. Our estimate for $3.4 billion in revenue for 2024 is on the high side of management’s outlook, which we think is supported by the recent expansion in Type 2 reimbursement and Dexcom’s continuous glucose monitor, or CGM, pipeline. With its business growing in size and scope, as well as heightened competition from Abbott, this year could be an inflection point with implications for Dexcom’s no-moat status. If the firm can successfully fend off competition, we may revisit our thinking on Dexcom’s moat.

Price vs Fair Value

DXCM is trading at a 16% premium.
Price
$122.30
Fair Value
$214.00
Uncertainty
High
1-Star Price
$547.72
5-Star Price
$48.00
Economic Moat
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Capital Allocation
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Bulls Say, Bears Say

Bulls

Dexcom's next-gen G7 product should be significantly less expensive, offer a thinner profile, and faster warm-up time than G6.

Bears

Considering Dexcom's sensors are already the most accurate, there's less opportunity for significant improvements on that dimension, compared with key competitors.

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News

Trading Information

Previous Close Price
$121.74
Day Range
$120.51124.30
52-Week Range
$74.75139.55
Bid/Ask
$121.00 / $122.95
Market Cap
$47.15 Bil
Volume/Avg
3.5 Mil / 3.0 Mil

Key Statistics

Price/Earnings (Normalized)
81.04
Price/Sales
14.37
Dividend Yield (Trailing)
Dividend Yield (Forward)
Total Yield
1.40%

Company Profile

Dexcom designs and commercializes continuous glucose monitoring systems for diabetic patients. CGM systems serve as an alternative to the traditional blood glucose meter process, and the company is evolving its CGM systems to provide integration with insulin pumps from Insulet and Tandem for automatic insulin delivery.
Sector
Healthcare
Industry
Medical Devices
Stock Style Box
Mid Growth
Total Number of Employees
9,600

Competitors

Valuation

Metric
DXCM
PODD
ABT
Price/Earnings (Normalized)
81.0461.7027.04
Price/Book Value
22.7916.015.39
Price/Sales
14.377.285.23
Price/Cash Flow
69.8236.7421.56
Price/Earnings
DXCM
PODD
ABT

Financial Strength

Metric
DXCM
PODD
ABT
Quick Ratio
2.392.361.16
Current Ratio
2.843.511.64
Interest Coverage
29.346.1410.86
Quick Ratio
DXCM
PODD
ABT

Profitability

Metric
DXCM
PODD
ABT
Return on Assets (Normalized)
10.03%8.02%10.63%
Return on Equity (Normalized)
28.40%33.45%20.87%
Return on Invested Capital (Normalized)
11.06%10.07%14.81%
Return on Assets
DXCM
PODD
ABT
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Medical Devices Industry Comparables

Ticker
Name
Morningstar Rating for Stocks
Economic Moat
Market Cap
ABT
Abbott LaboratoriesLfzzx$208.3 Bil
SYK
Stryker CorpQcxs$135.3 Bil
MDT
Medtronic PLCPft$112.9 Bil
BSX
Boston Scientific CorpWghpdt$98.9 Bil
EW
Edwards Lifesciences CorpJvrdrn$52.3 Bil
ZBH
Zimmer Biomet Holdings IncDbtbc$25.7 Bil
ALGN
Align Technology IncWnxxyvv$23.1 Bil
PHG
Koninklijke Philips NV ADRXrwyv$18.4 Bil
PODD
Insulet CorpLqrhv$11.7 Bil

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