Valued at a market cap of $29.6 billion, San Diego, California-based DexCom, Inc. (DXCM) is a medical device company specializing in designing, developing, and commercializing continuous glucose monitoring (CGM) systems. Its products, including the Dexcom G6 and G7, aim to help people with diabetes manage their blood glucose levels through real-time data transmission and monitoring.
Shares of the medical device company have underperformed the broader market over the past 52 weeks. DXCM has declined 27.9% over this time frame, while the broader S&P 500 Index ($SPX) has gained 30.4%. In 2024, DXCM stock dropped nearly 39%, compared to SPX's 23.1% YTD gain.
Further, DXCM stock has also lagged behind the Health Care Select Sector SPDR Fund's (XLV) 10.4% rise over the past 52 weeks and a 3.8% increase on a YTD basis.
Despite reporting better-than-expected Q3 adjusted EPS of $0.45 and revenue of $994.2 million on Oct. 24, shares of DexCom fell 1.9% the next day due to concerns over slowing sales growth, with only a 2% year-over-year revenue increase. Additionally, the decline in non-GAAP net income to $181 million from $204 million signaled potential profitability challenges. While DexCom launched products like Stelo and expanded into new markets, these efforts couldn't fully satisfy investor expectations for more robust growth in a competitive market.
For the current fiscal year, ending in December, analysts expect DXCM's EPS to grow 12.5% year-over-year to $1.71. The company's earnings surprise history is promising. It beat the consensus estimates in the last four quarters.
Among the 22 analysts covering the stock, the consensus rating is a “Strong Buy.” That’s based on 16 “Strong Buy” ratings, one “Moderate Buy,” and five “Holds.”
On Nov. 15, Larry Biegelsen of Wells Fargo reiterated a “Buy” rating on Dexcom, setting a price target of $90.
As of writing, DXCM is trading below the mean price target of $96.18. The Street-high price target of $120, implies a modest potential upside of 57% from the current price levels.
More news from BarchartOn the date of publication, Sohini Mondal did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information please view the Barchart Disclosure Policy here.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
