DexCom's Drop Is Your Shot

Sep. 10, 2024 5:38 PM ETDexCom, Inc. (DXCM) StockDXCM22 Comments

Summary

  • Despite a recent 40% drop in DexCom's stock price, I remain optimistic about its long-term potential due to its strong market position and innovative pipeline.
  • DexCom faces significant headwinds, including slower customer growth and increased competition, but remains well-positioned in the growing continuous glucose monitoring market.
  • Execution risks and increased competition are notable concerns, but the company's addressable market and demand for diabetes management tools provide a compelling risk/reward opportunity.
  • While not a must-own stock, DXCM offers potential for those who can handle volatility, with a fair stock price target of $96.
  • Looking for more investing ideas like this one? Get them exclusively at iREIT®+HOYA Capital. Learn More »
DexCom headquarters in San Diego, CA, USA.

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Introduction

Often, when dealing with fast-growing companies trading at what seem to be elevated multiples, I add that the margin of error is small. After all, a high valuation multiple isn't always a bad sign.

The problem is that when

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This article was written by

43.14K Followers

Leo Nelissen is an analyst focusing on major economic developments related to supply chains, infrastructure, and commodities. He is a contributing author for iREIT®+HOYA Capital.

As a member of the iREIT®+HOYA Capital team, Leo aims to provide insightful analysis and actionable investment ideas, with a particular emphasis on dividend growth opportunities. Learn More.

Analyst’s Disclosure:I/we have no stock, option or similar derivative position in any of the companies mentioned, and no plans to initiate any such positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

Seeking Alpha's Disclosure: Past performance is no guarantee of future results. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. Any views or opinions expressed above may not reflect those of Seeking Alpha as a whole. Seeking Alpha is not a licensed securities dealer, broker or US investment adviser or investment bank. Our analysts are third party authors that include both professional investors and individual investors who may not be licensed or certified by any institute or regulatory body.

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