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DexCom (DXCM) Q1 Earnings and Revenues Surpass Estimates
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DexCom, Inc. (DXCM - Free Report) reported adjusted earnings of 44 cents per share in first-quarter 2020, which comfortably surpassed the Zacks Consensus Estimate of 10 cents. Notably, the company has reported a loss per share of 5 cents in the prior-year quarter.
Total revenues surged 44.4% to $405.1 million on a year-over-year basis and also beat the Zacks Consensus Estimate by 14%. Rising volumes across all channels, strong new patient additions and increasing global awareness of the benefits of real-time Continuous Glucose Monitoring (CGM) contributed to the upside.
Segmental Details
Revenues at the Sensor and other revenue segment (80% of total revenues) surged 53.4% on a year-over-year basis to $325 million. Hardware revenues (20%) improved 16.8% year over year to $80.1 million.
Geographical Details
U.S. revenues (81% of total revenues) increased 38.9% on a year-over-year basis to $292.3 million. International revenues (19%) surged 61.1% year over year to $112.8 million.
Gross profit in the quarter under review totaled $256.5 million, up 51.9% year over year. However, DexCom generated gross margin (as a percentage of revenues) of 63.3%, which expanded 310 bps year over year.
Research and development expenses amounted to $73.1 million in the quarter, up 23.9% year over year. Selling, general and administrative expenses totaled $149.8 million in the reported quarter, up 20.6% year over year.
The company reported total operating expenses of $222.9 million, up 21.7% year over year.
The company reported operating income of $33.6 million, against the year-ago quarter’s operating loss of $14.4 million.
Financial Position
The company exited the first quarter with $584.6 million in cash and cash equivalents, which surged 31% from year-end 2019.
2020 Guidance
The company has decided to suspend full-year 2020 guidance (issued previously on Feb 13, 2020) on account of the uncertainty with respect to the duration and impact of the COVID-19 pandemic.
Wrapping Up
DexCom exited the first quarter on a strong note, wherein both earnings and revenues beat the Zacks Consensus Estimate. Impressive contributions from the segments were key catalysts. Expansion in gross margin is a positive.
Additionally, the glucose monitoring market presents significant commercial opportunity for this company. DexCom’s opportunities in alternative markets such as the non-intensive diabetes management space, the hospital, gestational, pre-diabetes and obesity are likely to provide it a competitive edge in the MedTech space.
However, due to the uncertainty surrounding the COVID-19 pandemic, the company has suspended full-year 2020 guidance. Meanwhile, cut-throat competition in the market for blood & glucose monitoring devices remains a concern.
Zacks Rank
Currently, DexCom carries a Zacks Rank of 3 (Hold).
The Zacks Consensus Estimate for Exact Sciences’s first-quarter 2020 revenues is pegged at $350.2 million, suggesting a whopping year-over-year improvement of 116.1%. The same for EPS stands at a loss of 60 cents, indicating growth of 9.1% from the prior-year quarter.
The Zacks Consensus Estimate for ViewRay’s first-quarter 2020 earnings per share stands at a loss of 20 cents, suggesting an improvement of 41.8% from the year-ago period.
The Zacks Consensus Estimate for ResMed’s third-quarter fiscal 2020 revenues is pegged at $715.6 million, suggesting year-over-year improvement of 8.1%. The same for EPS stands at $1.00, indicating growth of 12.4% from the year-ago reported figure.
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DexCom (DXCM) Q1 Earnings and Revenues Surpass Estimates
DexCom, Inc. (DXCM - Free Report) reported adjusted earnings of 44 cents per share in first-quarter 2020, which comfortably surpassed the Zacks Consensus Estimate of 10 cents. Notably, the company has reported a loss per share of 5 cents in the prior-year quarter.
Total revenues surged 44.4% to $405.1 million on a year-over-year basis and also beat the Zacks Consensus Estimate by 14%. Rising volumes across all channels, strong new patient additions and increasing global awareness of the benefits of real-time Continuous Glucose Monitoring (CGM) contributed to the upside.
Segmental Details
Revenues at the Sensor and other revenue segment (80% of total revenues) surged 53.4% on a year-over-year basis to $325 million. Hardware revenues (20%) improved 16.8% year over year to $80.1 million.
Geographical Details
U.S. revenues (81% of total revenues) increased 38.9% on a year-over-year basis to $292.3 million. International revenues (19%) surged 61.1% year over year to $112.8 million.
DexCom, Inc. Price, Consensus and EPS Surprise
DexCom, Inc. price-consensus-eps-surprise-chart | DexCom, Inc. Quote
Margin Analysis
Gross profit in the quarter under review totaled $256.5 million, up 51.9% year over year. However, DexCom generated gross margin (as a percentage of revenues) of 63.3%, which expanded 310 bps year over year.
Research and development expenses amounted to $73.1 million in the quarter, up 23.9% year over year. Selling, general and administrative expenses totaled $149.8 million in the reported quarter, up 20.6% year over year.
The company reported total operating expenses of $222.9 million, up 21.7% year over year.
The company reported operating income of $33.6 million, against the year-ago quarter’s operating loss of $14.4 million.
Financial Position
The company exited the first quarter with $584.6 million in cash and cash equivalents, which surged 31% from year-end 2019.
2020 Guidance
The company has decided to suspend full-year 2020 guidance (issued previously on Feb 13, 2020) on account of the uncertainty with respect to the duration and impact of the COVID-19 pandemic.
Wrapping Up
DexCom exited the first quarter on a strong note, wherein both earnings and revenues beat the Zacks Consensus Estimate. Impressive contributions from the segments were key catalysts. Expansion in gross margin is a positive.
Additionally, the glucose monitoring market presents significant commercial opportunity for this company. DexCom’s opportunities in alternative markets such as the non-intensive diabetes management space, the hospital, gestational, pre-diabetes and obesity are likely to provide it a competitive edge in the MedTech space.
However, due to the uncertainty surrounding the COVID-19 pandemic, the company has suspended full-year 2020 guidance. Meanwhile, cut-throat competition in the market for blood & glucose monitoring devices remains a concern.
Zacks Rank
Currently, DexCom carries a Zacks Rank of 3 (Hold).
Key Picks
Some better-ranked stocks in the broader medical space are Exact Sciences Corporation (EXAS - Free Report) , ViewRay, Inc. and ResMed Inc. (RMD - Free Report) , each carrying a Zacks Rank of 2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
The Zacks Consensus Estimate for Exact Sciences’s first-quarter 2020 revenues is pegged at $350.2 million, suggesting a whopping year-over-year improvement of 116.1%. The same for EPS stands at a loss of 60 cents, indicating growth of 9.1% from the prior-year quarter.
The Zacks Consensus Estimate for ViewRay’s first-quarter 2020 earnings per share stands at a loss of 20 cents, suggesting an improvement of 41.8% from the year-ago period.
The Zacks Consensus Estimate for ResMed’s third-quarter fiscal 2020 revenues is pegged at $715.6 million, suggesting year-over-year improvement of 8.1%. The same for EPS stands at $1.00, indicating growth of 12.4% from the year-ago reported figure.
Zacks Top 10 Stocks for 2020
In addition to the stocks discussed above, would you like to know about our 10 finest buy-and-hold tickers for the entirety of 2020?
Last year's 2019 Zacks Top 10 Stocks portfolio returned gains as high as +102.7%. Now a brand-new portfolio has been handpicked from over 4,000 companies covered by the Zacks Rank. Don’t miss your chance to get in on these long-term buys.
Access Zacks Top 10 Stocks for 2020 today >>