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San Diego, California-based DexCom, Inc. (DXCM) is a medical device company. It focuses on the design, development, and commercialization of continuous glucose monitoring (CGM) systems. With a market cap of $28.7 billion, DexCom operations span the Americas, Europe, and internationally.
Shares of the glucose monitor maker have substantially underperformed the broader market over the past year. Over the past 52 weeks, DXCM plummeted 32.4%, lagging behind the S&P 500 Index’s ($SPX) nearly 27% returns. In 2024 alone, DXCM is down 41.8% compared to SPX’s 16.8% gains on a YTD basis.
Narrowing the focus, DXCM also underperformed the US Medical Devices Ishares ETF’s (IHI) 12.2% returns over the past 52 weeks and 7.4% gains on a YTD basis.
Despite beating profit estimates, shares of DexCom plunged 40.7% following the release of its Q2 earnings on Jul. 25 due to the company's reduction in its full-year revenue guidance, driven by a restructuring of its sales team, fewer customers, and lower revenue per customer. It now anticipates fiscal 2024 revenues between $4 billion and $4.05 billion, down from a previously announced range of $4.2 billion to $4.35 billion. Additionally, DexCom’s forecast for Q3 revenue fell short of analysts' expectations, exacerbating investor concerns.
For the current fiscal year, ending in December, analysts expect DexCom to report an EPS growth of 11.2% year over year to $1.69. The company’s earnings surprise history is robust. It beat the consensus estimates in all of the last four quarters.
Among the 22 analysts covering the DXCM stock, the consensus rating is a “Strong Buy.” That’s based on 16 “Strong Buy” ratings, one “Moderate Buy,” and five “Holds.”
This configuration is slightly less bullish than a month before, with 18 analysts recommending a “Strong Buy.”
On Aug. 16, RBC Capital analyst Shagun Singh Chadha maintained a “Buy” rating with a price target of $130.
DXCM’s mean price target of $96.41 represents a premium of 33.4% from current price levels. The Street-high target of $145 indicates a potential upside of 100.6%.
On the date of publication, Aditya Sarawgi 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.
