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Here's Why You Should Hold On to DexCom (DXCM) Stock Now
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DexCom (DXCM - Free Report) is well-poised for growth, backed by a robust product portfolio and a strong international presence. However, supply constraints remain a concern.
Shares of this Zacks Rank #3 (Hold) company have lost 38.8% compared with the industry’s decline of 28.9% so far this year. Meanwhile, the S&P 500 Index has fallen 24.1%.
Image Source: Zacks Investment Research
DexCom — with a market capitalization of $31.65 billion — is a medical device company focused on the design, development and commercialization of continuous glucose monitoring systems (CGM). It anticipates earnings to improve 31% over the next five years. The company beat earnings estimates in two of the trailing four quarters and missed twice, the average surprise being 15.84%.
Key Catalysts
On the basis of business growth and expanding patient base, the extension of G7 into all the core markets might extend to 2022 as the company ramps up manufacturing to lend support to the markets in an efficient manner.
In May 2022, DexCom introduced the Dexcom ONE CGM System in the U.K. This new system is an easy-to-use real-time CGM (rt-CGM) and is more accessible and affordable for people suffering from diabetes in the country. Presently, Dexcom ONE is in review to be added to drug tariffs throughout the U.K. regions. It is worth mentioning that Dexcom ONE will become part of the broad range of products offered by the company for people with diabetes in the U.K., including the Dexcom G6 CGM system and the upcoming Dexcom G7 CGM system.
In March 2022, DexCom announced that the Ontario government offered coverage for the Dexcom G6 CGM System. The government will offer this coverage through its Assistive Devices Program (ADP) to people living with type one diabetes in the province and are over two years of age and fulfill the coverage criteria. It is worth noting that the back of the upper arm insertion site is for ages 18 and above. In the same month, the company received the FDA’s Breakthrough Device Designation for the Dexcom CGM System’s use in the hospital setting. The designation is expected to provide a more efficient and streamlined review pathway to enable Dexcom CGM technology to rapidly strengthen the company’s presence in the hospital market.
In first-quarter 2022, international revenues (28% of total revenues) surged 43% year over year to $177.6 million, owing to the widening of commercial footprint. DexCom’s market expansion initiatives internationally are all progressing according to plan, thereby driving high-volume growth. Thus, international growth remains strong, courtesy of improving global access and awareness.
Primary Headwind
DexCom relies on third parties for an assured steady supply of inputs. Consequently, the capacity constraint for the production of its offerings might dampen the company’s growth prospects.
Estimates Trend
The Zacks Consensus Estimate for 2022 revenues is pegged at $2.92 billion, suggesting growth of 19.3% from the year-ago reported number. The same for earnings stands at 76 cents, indicating an improvement of 13.4% from the prior-year quarter.
Some better-ranked stocks from the broader medical space are AMN Healthcare Services, Inc. (AMN - Free Report) , Patterson Companies, Inc. (PDCO - Free Report) and ShockWave Medical, Inc. .
AMN Healthcare, sporting a Zacks Rank #1 (Strong Buy) at present, has an estimated long-term growth rate of 1.1%. AMN’s earnings surpassed the Zacks Consensus Estimate in all four trailing quarters, the average being 15.6%.
AMN Healthcarehas gained 13.8% against the industry’s 32.7% fall in the past year.
Patterson Companies, carrying a Zacks Rank #2 (Buy) at present, has an estimated long-term growth rate of 9.6%. PDCO’s earnings surpassed estimates in all the trailing four quarters, the average being 16.5%.
Patterson Companies has lost 1.8% compared with the industry’s 10.5% fall over the past year.
ShockWave Medical, sporting a Zacks Rank of 1 at present, has an estimated growth rate of 44.9% for 2023. SWAV’s earnings surpassed estimates in all the trailing four quarters, the average being 189.9%.
ShockWave Medical has gained 7.9% against the industry’s 24.4% fall over the past year.
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Here's Why You Should Hold On to DexCom (DXCM) Stock Now
DexCom (DXCM - Free Report) is well-poised for growth, backed by a robust product portfolio and a strong international presence. However, supply constraints remain a concern.
Shares of this Zacks Rank #3 (Hold) company have lost 38.8% compared with the industry’s decline of 28.9% so far this year. Meanwhile, the S&P 500 Index has fallen 24.1%.
Image Source: Zacks Investment Research
DexCom — with a market capitalization of $31.65 billion — is a medical device company focused on the design, development and commercialization of continuous glucose monitoring systems (CGM). It anticipates earnings to improve 31% over the next five years. The company beat earnings estimates in two of the trailing four quarters and missed twice, the average surprise being 15.84%.
Key Catalysts
On the basis of business growth and expanding patient base, the extension of G7 into all the core markets might extend to 2022 as the company ramps up manufacturing to lend support to the markets in an efficient manner.
In May 2022, DexCom introduced the Dexcom ONE CGM System in the U.K. This new system is an easy-to-use real-time CGM (rt-CGM) and is more accessible and affordable for people suffering from diabetes in the country. Presently, Dexcom ONE is in review to be added to drug tariffs throughout the U.K. regions. It is worth mentioning that Dexcom ONE will become part of the broad range of products offered by the company for people with diabetes in the U.K., including the Dexcom G6 CGM system and the upcoming Dexcom G7 CGM system.
In March 2022, DexCom announced that the Ontario government offered coverage for the Dexcom G6 CGM System. The government will offer this coverage through its Assistive Devices Program (ADP) to people living with type one diabetes in the province and are over two years of age and fulfill the coverage criteria. It is worth noting that the back of the upper arm insertion site is for ages 18 and above. In the same month, the company received the FDA’s Breakthrough Device Designation for the Dexcom CGM System’s use in the hospital setting. The designation is expected to provide a more efficient and streamlined review pathway to enable Dexcom CGM technology to rapidly strengthen the company’s presence in the hospital market.
In first-quarter 2022, international revenues (28% of total revenues) surged 43% year over year to $177.6 million, owing to the widening of commercial footprint. DexCom’s market expansion initiatives internationally are all progressing according to plan, thereby driving high-volume growth. Thus, international growth remains strong, courtesy of improving global access and awareness.
Primary Headwind
DexCom relies on third parties for an assured steady supply of inputs. Consequently, the capacity constraint for the production of its offerings might dampen the company’s growth prospects.
Estimates Trend
The Zacks Consensus Estimate for 2022 revenues is pegged at $2.92 billion, suggesting growth of 19.3% from the year-ago reported number. The same for earnings stands at 76 cents, indicating an improvement of 13.4% from the prior-year quarter.
DexCom, Inc. Price
DexCom, Inc. price | DexCom, Inc. Quote
Stocks to Consider
Some better-ranked stocks from the broader medical space are AMN Healthcare Services, Inc. (AMN - Free Report) , Patterson Companies, Inc. (PDCO - Free Report) and ShockWave Medical, Inc. .
AMN Healthcare, sporting a Zacks Rank #1 (Strong Buy) at present, has an estimated long-term growth rate of 1.1%. AMN’s earnings surpassed the Zacks Consensus Estimate in all four trailing quarters, the average being 15.6%.
You can see the complete list of today’s Zacks #1 Rank stocks here.
AMN Healthcarehas gained 13.8% against the industry’s 32.7% fall in the past year.
Patterson Companies, carrying a Zacks Rank #2 (Buy) at present, has an estimated long-term growth rate of 9.6%. PDCO’s earnings surpassed estimates in all the trailing four quarters, the average being 16.5%.
Patterson Companies has lost 1.8% compared with the industry’s 10.5% fall over the past year.
ShockWave Medical, sporting a Zacks Rank of 1 at present, has an estimated growth rate of 44.9% for 2023. SWAV’s earnings surpassed estimates in all the trailing four quarters, the average being 189.9%.
ShockWave Medical has gained 7.9% against the industry’s 24.4% fall over the past year.