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DexCom (DXCM) Gains FDA Approval for G5 Mobile CGM System
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San Diego, CA-based DexCom, Inc. (DXCM - Free Report) , a renowned medical device company, announced the U.S. FDA approval for its G5 Mobile CGM (continuous glucose monitoring) system. Notably, G5 Mobile is the only CGM system that enables daily diabetes treatment without frequent pricking of the finger. Per management, the approval is expected to establish a new benchmark in glucose monitoring for diabetes management.
For the last six months, the company has a negative return of almost 18%, wider than the Zacks categorized Medical Instruments sub-industry’s decline of roughly 2.9%. However, DexCom witnessed a nominal increase of roughly 0.3% to close at $63.56 yesterday, breaking the dismal market trend.
Meanwhile, the estimate revision trend has been unfavorable as 12 estimates moved south over the past two months with no movement in the opposite direction. In fact, current year estimates for the stock decreased by a penny to a loss of 77 cents per share as another estimate moved down last month.
On the brighter side, DexCom’s long-term fundamentals are compelling. The company recorded a three-year CAGR of 59% for revenues, a strong positive in our view. Meanwhile, a long-term expected earnings growth of 32.5% instills investor confidence. Additionally, the Zacks Rank #3 (Hold) company promises sales growth of 41.9% for the current year, comparing favorably with the industry’s 6.3%.
Coming back to the development, the go-ahead paved way for an appropriate replacement to the traditional finger stick glucose treatment procedures in diabetes management. Notably, in Jul 2016, a panel of experts selected by the FDA marked the G5 Mobile CGM system safe.
Of the other products in the CGM pipeline, the DexCom G4 Platinum product line has been a flagship and is significantly boosting the company’s top line since long.
Our Take
The G5 Mobile CGM system has emerged as the first and only non-adjunctive CGM system in the U.S. We believe the non-adjunctive indication of this system should fortify the company’s foothold in the continuous glucose monitoring markets. Meanwhile, the niche markets are forecasted to reach a worth of $568.5 million globally by 2020, multiplying at a CAGR of 14.8% (Allied Market Research).
However, the market for blood glucose monitoring devices is highly competitive, subject to rapid change and is significantly affected by product introductions. On this note, DexCom competes directly with bigwigs like Roche Diabetes Care – a division of Roche Diagnostics and LifeScan, Inc. – a division of Johnson & Johnson.
Other Key Picks
Other favorably ranked stocks in the broader medical sector include Addus HomeCare Corporation (ADUS - Free Report) , LHC Group, Inc. and IDEXX Laboratories, Inc. (IDXX - Free Report) . Addus HomeCare and IDEXX Laboratories sport a Zacks Rank #1. Meanwhile, LHC Group carries a Zacks Rank #2. You can see the complete list of today’s Zacks #1 Rank stocks here.
Addus HomeCare has a long-term expected earnings growth rate of approximately 15%. Notably, the stock represents an impressive one-year return of 50.4%.
LHC Group has a long-term expected earnings growth rate of 15%. The company has returned almost 22.2% in the last three months.
IDEXX Laboratories has an expected earnings growth of almost 15%. The company posted a promising year-to-date return of 62.3%.
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DexCom (DXCM) Gains FDA Approval for G5 Mobile CGM System
San Diego, CA-based DexCom, Inc. (DXCM - Free Report) , a renowned medical device company, announced the U.S. FDA approval for its G5 Mobile CGM (continuous glucose monitoring) system. Notably, G5 Mobile is the only CGM system that enables daily diabetes treatment without frequent pricking of the finger. Per management, the approval is expected to establish a new benchmark in glucose monitoring for diabetes management.
For the last six months, the company has a negative return of almost 18%, wider than the Zacks categorized Medical Instruments sub-industry’s decline of roughly 2.9%. However, DexCom witnessed a nominal increase of roughly 0.3% to close at $63.56 yesterday, breaking the dismal market trend.
Meanwhile, the estimate revision trend has been unfavorable as 12 estimates moved south over the past two months with no movement in the opposite direction. In fact, current year estimates for the stock decreased by a penny to a loss of 77 cents per share as another estimate moved down last month.
On the brighter side, DexCom’s long-term fundamentals are compelling. The company recorded a three-year CAGR of 59% for revenues, a strong positive in our view. Meanwhile, a long-term expected earnings growth of 32.5% instills investor confidence. Additionally, the Zacks Rank #3 (Hold) company promises sales growth of 41.9% for the current year, comparing favorably with the industry’s 6.3%.
Coming back to the development, the go-ahead paved way for an appropriate replacement to the traditional finger stick glucose treatment procedures in diabetes management. Notably, in Jul 2016, a panel of experts selected by the FDA marked the G5 Mobile CGM system safe.
DEXCOM INC Price
DEXCOM INC Price | DEXCOM INC Quote
Of the other products in the CGM pipeline, the DexCom G4 Platinum product line has been a flagship and is significantly boosting the company’s top line since long.
Our Take
The G5 Mobile CGM system has emerged as the first and only non-adjunctive CGM system in the U.S. We believe the non-adjunctive indication of this system should fortify the company’s foothold in the continuous glucose monitoring markets. Meanwhile, the niche markets are forecasted to reach a worth of $568.5 million globally by 2020, multiplying at a CAGR of 14.8% (Allied Market Research).
However, the market for blood glucose monitoring devices is highly competitive, subject to rapid change and is significantly affected by product introductions. On this note, DexCom competes directly with bigwigs like Roche Diabetes Care – a division of Roche Diagnostics and LifeScan, Inc. – a division of Johnson & Johnson.
Other Key Picks
Other favorably ranked stocks in the broader medical sector include Addus HomeCare Corporation (ADUS - Free Report) , LHC Group, Inc. and IDEXX Laboratories, Inc. (IDXX - Free Report) . Addus HomeCare and IDEXX Laboratories sport a Zacks Rank #1. Meanwhile, LHC Group carries a Zacks Rank #2. You can see the complete list of today’s Zacks #1 Rank stocks here.
Addus HomeCare has a long-term expected earnings growth rate of approximately 15%. Notably, the stock represents an impressive one-year return of 50.4%.
LHC Group has a long-term expected earnings growth rate of 15%. The company has returned almost 22.2% in the last three months.
IDEXX Laboratories has an expected earnings growth of almost 15%. The company posted a promising year-to-date return of 62.3%.
Zacks’ Best Private Investment Ideas
In addition to the recommendations that are available to the public on our website, how would you like to follow all Zacks' private buys and sells in real time?
Our experts cover all kinds of trades… from value to momentum . . . from stocks under $10 to ETF and option moves . . . from stocks that corporate insiders are buying up to companies that are about to report positive earnings surprises. You can even look inside exclusive portfolios that are normally closed to new investors. Starting today, for the next month, you can have unrestricted access.Click here for Zacks' private trades >>