Dexcom (DXCM) AI Stock Analysis

• Market Cap: $24.17B
• Dividend Yield: N/A
• Average Volume (3M): 4.49M
• Price to Earnings (P/E): 42.6
• Beta (1Y): 1.07
• Revenue Growth: 11.34%
• EPS Growth: 4.24%
• Country: US
• Employees: 10,200
• Sector: Healthcare
• Sector Strength: 78
• Industry: Medical - Devices
• EPS (TTM): 1.42
• Shares Outstanding: 392,107,500
• 10 Day Avg. Volume: 4,846,568
• 30 Day Avg. Volume: 4,491,245
• PEG Ratio: 10.04
• Price to Book (P/B): N/A
• Price to Sales (P/S): 7.15
• Price to Cash Flow (P/CF): 23.90
• P/FCF Ratio: 23.80
• Enterprise Value/Market Cap: N/A
• Enterprise Value/Revenue: N/A
• Enterprise Value/Gross Profit: N/A
• Enterprise Value/Ebitda: N/A
• 1Y Price Target: $103.40
• Price Target Upside: 70.37% Upside
• Rating Consensus: Strong Buy
• Number of Analyst Covering: 18

Dexcom's strong financial performance and positive earnings call are offset by technical analysis indicating downward momentum and valuation concerns due to a high P/E ratio. The strategic board appointment provides a moderate positive outlook amidst challenges.

Positive Factors

Financial Performance

DXCM reiterated revenue guidance in the 8k that originally disclosed the warning letter.

Market Position

DXCM is trading at a valuation that is attractive for its long-term growth rate.

Product Development

The G7 15-day sensor's MARD data underscores a strong value proposition, expected to be well-received by investors.

Negative Factors

Operational Concerns

FDA findings around non-conformities in manufacturing processes and quality management system after facilities inspections.

Regulatory Issues

Dexcom announced it had received a warning letter from the FDA following the agency’s inspection of its Mesa and San Diego facilities, which added near-term pressure on the stock.

Dexcom Business Overview & Revenue Model

Company Description

DexCom, Inc., a medical device company, focuses on the design, development, and commercialization of continuous glucose monitoring (CGM) systems in the United States and internationally. The company provides its systems for use by people with diabetes, as well as for use by healthcare providers. Its products include DexCom G6, an integrated CGM system for diabetes management; Dexcom Real-Time API, which enables invited third-party developers to integrate real-time CGM data into their digital health applications and devices; Dexcom ONE, that is designed to replace finger stick blood glucose testing for diabetes treatment decisions; and Dexcom Share, a remote monitoring system. The company's products candidature comprises Dexcom G7, a next generation G7 CGM system. DexCom, Inc. has a collaboration and license agreement with Verily Life Sciences LLC and Verily Ireland Limited to develop blood-based or interstitial glucose monitoring products. The company markets its products directly to endocrinologists, physicians, and diabetes educators. DexCom, Inc. was incorporated in 1999 and is headquartered in San Diego, California.

How the Company Makes Money

Dexcom makes money primarily through the sale of its continuous glucose monitoring systems, which include sensors, transmitters, and receivers or compatible smart devices. The company's revenue model is based on a combination of direct sales to consumers and healthcare providers, as well as through partnerships with insurance companies and healthcare systems that facilitate the reimbursement processes for patients. Additionally, Dexcom generates revenue through ongoing replacement sales of sensors and transmitters, which need regular replenishment. Significant partnerships with technology firms, such as those integrating Dexcom's data into broader health management platforms, also enhance its market reach and contribute to its earnings. The company's focus on innovation and product improvement helps maintain its competitive advantage in the growing diabetes management market.

Dexcom Financial Statement Overview

Summary

Dexcom exhibits strong income growth and profitability with a stable operational performance. The balance sheet shows effective equity use but highlights a reliance on liabilities. Incomplete cash flow data for 2024 limits full assessment, though previous data indicates good cash generation.

Income Statement

Dexcom demonstrates strong revenue growth, with a revenue increase from $3.62 billion in 2023 to $4.03 billion in 2024, reflecting a growth rate of 11.34%. The gross profit margin is robust at 61.13% for 2024. Net profit margin also improved to 14.29% from 14.95% in the previous year. The EBIT margin remains stable at 14.87%, indicating consistent operational efficiency. These metrics highlight a healthy and growing financial performance, supported by efficient cost management.

Balance Sheet

Dexcom maintains a moderate debt-to-equity ratio of 1.20 in 2024, suggesting a balanced use of debt and equity financing. The return on equity (ROE) is strong at 27.40%, indicating effective use of shareholders' equity to generate profits. However, the equity ratio is 32.42%, which could suggest a higher reliance on liabilities. Overall, the balance sheet reflects stability with a manageable level of debt.

Cash Flow

The cash flow statement lacks complete data for 2024, making it challenging to fully assess the cash flow performance. However, in 2023, Dexcom had a positive free cash flow of $511.9 million, indicating good cash generation. The absence of 2024 cash flow data is a concern for assessing ongoing cash management and investment capacity.

Breakdown
Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement		Total Revenue
4.03B	3.62B	2.91B	2.45B	1.93B
	Gross Profit
2.47B	2.29B	1.88B	1.68B	1.28B
	EBIT
600.00M	597.70M	391.20M	175.40M	299.50M
	EBITDA
840.70M	916.70M	565.30M	377.50M	376.80M
	Net Income Common Stockholders
576.20M	541.50M	341.20M	154.70M	493.60M
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
2.58B	2.72B	2.46B	2.73B	2.71B
	Total Assets
6.48B	6.26B	5.39B	4.86B	4.29B
	Total Debt
2.53B	2.59B	2.09B	1.82B	1.84B
	Net Debt
1.92B	2.03B	1.44B	769.20M	1.02B
	Total Liabilities
4.38B	4.20B	3.26B	2.61B	2.46B
	Stockholders Equity
2.10B	2.07B	2.13B	2.25B	1.83B
Cash Flow		Free Cash Flow
630.70M	511.90M	304.70M	53.30M	276.60M
	Operating Cash Flow
989.50M	748.50M	669.50M	442.50M	475.60M
	Investing Cash Flow
-207.50M	-507.20M	-521.50M	-216.10M	-1.02B
	Financing Cash Flow
-734.80M	-318.60M	-552.50M	10.40M	912.10M

Dexcom Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 60.69
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Positive
• RSI: Neutral
• STOCH: Positive

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For DXCM, the sentiment is Negative. The current price of 60.69 is below the 20-day moving average (MA) of 69.01, below the 50-day MA of 79.06, and below the 200-day MA of 79.74, indicating a bearish trend. The MACD of -3.61 indicates Positive momentum. The RSI at 31.77 is Neutral, neither overbought nor oversold. The STOCH value of 11.73 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for DXCM.

Dexcom Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
STE	78 Outperform	$20.90B	45.12	9.61%	1.05%	-0.17%	-17.34%
PODD	76 Outperform	$17.99B	42.68	43.03%	―	22.07%	101.95%
EW	68 Neutral	$40.42B	27.38	17.17%	―	-4.67%	6.23%
DXCM	61 Neutral	$24.17B	42.60	27.63%	―	11.34%	4.24%
TNDM	56 Neutral	$1.12B	―	-33.30%	―	25.74%	57.18%
PHG	50 Neutral	$20.63B	―	-7.10%	―	-0.76%	-55.03%
Sector *	48 Neutral	$6.27B	1.17	-48.19%	2.68%	17.28%	1.24%

Dexcom Corporate Events

Dexcom Expands Board with New Director Appointment

On March 6, 2025, Dexcom’s Board of Directors expanded to eleven members with the appointment of Renée Galá as a director. Ms. Galá, recognized for her strategic and financial leadership in the life sciences sector, brings significant expertise to Dexcom, enhancing its potential to drive growth and create shareholder value. Her appointment reflects Dexcom’s strategic focus on expanding its influence in the metabolic health sector, leveraging her experience in global finance and operations.