DexCom, Inc. (DXCM - Free Report) reported adjusted earnings of $1.15 per share in fourth-quarter 2019, which surpassed the Zacks Consensus Estimate of 75 cents by 53.3%. Moreover, the bottom line soared 105.4% from the prior-year quarter.
Total revenues surged 36.9% to $462.8 million on a year-over-year basis and also beat the Zacks Consensus Estimate by 1.3%. 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.
2019 at a Glance
In 2019, the company reported revenues worth $1.48 billion, which improved 43.1% from the previous year. The top line also beat the Zacks Consensus Estimate by 2.1%.
Adjusted EPS for the year was $1.84, which improved significantly from that of 2018. The figure also surpassed the consensus mark by 28.7%.
Segmental Details
Revenues at the Sensor segment (78% of total revenues) surged 42.2% on a year-over-year basis to $359.5 million. Transmitter revenues (19%) improved 45.9% year over year to $86.1 million. Receiver revenues (4%) declined 34.6% year over year to $17.2 million.
Geographical Details
U.S. revenues (81% of total revenues) climbed 33.8% on a year-over-year basis to $375.9 million. International revenues (19%) surged 52.5% year over year to $86.9 million.
Margin Analysis
Gross profit in the quarter under review totaled $309.3 million, up 38.8% year over year. However, DexCom generated gross margin (as a percentage of revenues) of 66.8%, which expanded 90 bps year over year.
Research and development (R&D) expenses amounted to $78.8 million in the quarter, up 36.8% year over year. Selling, general and administrative expenses totaled $129 million in the reported quarter, up 15.1% year over year.
The company reported total operating expenses of $207.8 million, down 46.4% year over year.
The company reported operating income of $101.5 million, against the year-ago quarter’s operating loss of $164.9 million.
Financial Position
As of Dec 31, 2019, DexCom had $1.53 billion in cash and marketable securities.
Total cash and cash equivalents came in at $446.2 million, which plunged 60.8% from the prior-year quarter.
2020 Guidance
DexCom expects revenues to range between $1.73 billion and $1.78 billion. The Zacks Consensus Estimate for revenues is currently pegged at $1.75 billion.
Gross profit margin is projected to be around 64% of net revenues.
While adjusted operating margin is expected to be about 13% of net revenues, adjusted EBITDA margin is anticipated to be 23%.
Wrapping Up
DexCom exited the fourth quarter on a strong note, wherein both earnings and revenues beat the Zacks Consensus Estimate. Impressive contributions from the Sensor and Transmitter segments were key catalysts. Expansion in gross margin is a positive. Strong guidance also instills investor optimism in the stock.
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. Notably, during the fourth quarter, the company commenced launch of G6 into Medicare.
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).
Earnings of Other MedTech Majors at a Glance
Some better-ranked stocks which reported solid results this earning season are Stryker Corporation (SYK - Free Report) , Accuray Incorporated (ARAY - Free Report) and IDEXX Laboratories, Inc. (IDXX - Free Report) . You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Stryker delivered fourth-quarter 2019 adjusted EPS of $2.49, outpacing the Zacks Consensus Estimate by 1.2%. Fourth-quarter reported revenues of $4.13 billion surpassed the Zacks Consensus Estimate by 0.7%. The company carries a Zacks Rank #2.
Accuray reported second-quarter fiscal 2020 adjusted earnings per share (EPS) of a penny, beating the Zacks Consensus Estimate of a loss of 7 cents. Net revenues of $98.8 million outpaced the Zacks Consensus Estimate by 0.3%. The company sports a Zacks Rank #1.
IDEXX Laboratories reported fourth-quarter 2019 adjusted EPS of $1.04, which beat the Zacks Consensus Estimate of 91 cents by 14.3%. Revenues were $605.4 million, surpassing the Zacks Consensus Estimate by 0.9%. The company carries a Zacks Rank of 2.
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DexCom, Inc. (DXCM - Free Report) reported adjusted earnings of $1.15 per share in fourth-quarter 2019, which surpassed the Zacks Consensus Estimate of 75 cents by 53.3%. Moreover, the bottom line soared 105.4% from the prior-year quarter.
Total revenues surged 36.9% to $462.8 million on a year-over-year basis and also beat the Zacks Consensus Estimate by 1.3%. 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.
2019 at a Glance
In 2019, the company reported revenues worth $1.48 billion, which improved 43.1% from the previous year. The top line also beat the Zacks Consensus Estimate by 2.1%.
Adjusted EPS for the year was $1.84, which improved significantly from that of 2018. The figure also surpassed the consensus mark by 28.7%.
Segmental Details
Revenues at the Sensor segment (78% of total revenues) surged 42.2% on a year-over-year basis to $359.5 million. Transmitter revenues (19%) improved 45.9% year over year to $86.1 million. Receiver revenues (4%) declined 34.6% year over year to $17.2 million.
Geographical Details
U.S. revenues (81% of total revenues) climbed 33.8% on a year-over-year basis to $375.9 million. International revenues (19%) surged 52.5% year over year to $86.9 million.
Margin Analysis
Gross profit in the quarter under review totaled $309.3 million, up 38.8% year over year. However, DexCom generated gross margin (as a percentage of revenues) of 66.8%, which expanded 90 bps year over year.
Research and development (R&D) expenses amounted to $78.8 million in the quarter, up 36.8% year over year. Selling, general and administrative expenses totaled $129 million in the reported quarter, up 15.1% year over year.
The company reported total operating expenses of $207.8 million, down 46.4% year over year.
The company reported operating income of $101.5 million, against the year-ago quarter’s operating loss of $164.9 million.
Financial Position
As of Dec 31, 2019, DexCom had $1.53 billion in cash and marketable securities.
Total cash and cash equivalents came in at $446.2 million, which plunged 60.8% from the prior-year quarter.
2020 Guidance
DexCom expects revenues to range between $1.73 billion and $1.78 billion. The Zacks Consensus Estimate for revenues is currently pegged at $1.75 billion.
Gross profit margin is projected to be around 64% of net revenues.
While adjusted operating margin is expected to be about 13% of net revenues, adjusted EBITDA margin is anticipated to be 23%.
Wrapping Up
DexCom exited the fourth quarter on a strong note, wherein both earnings and revenues beat the Zacks Consensus Estimate. Impressive contributions from the Sensor and Transmitter segments were key catalysts. Expansion in gross margin is a positive. Strong guidance also instills investor optimism in the stock.
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. Notably, during the fourth quarter, the company commenced launch of G6 into Medicare.
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).
Earnings of Other MedTech Majors at a Glance
Some better-ranked stocks which reported solid results this earning season are Stryker Corporation (SYK - Free Report) , Accuray Incorporated (ARAY - Free Report) and IDEXX Laboratories, Inc. (IDXX - Free Report) . You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Stryker delivered fourth-quarter 2019 adjusted EPS of $2.49, outpacing the Zacks Consensus Estimate by 1.2%. Fourth-quarter reported revenues of $4.13 billion surpassed the Zacks Consensus Estimate by 0.7%. The company carries a Zacks Rank #2.
Accuray reported second-quarter fiscal 2020 adjusted earnings per share (EPS) of a penny, beating the Zacks Consensus Estimate of a loss of 7 cents. Net revenues of $98.8 million outpaced the Zacks Consensus Estimate by 0.3%. The company sports a Zacks Rank #1.
IDEXX Laboratories reported fourth-quarter 2019 adjusted EPS of $1.04, which beat the Zacks Consensus Estimate of 91 cents by 14.3%. Revenues were $605.4 million, surpassing the Zacks Consensus Estimate by 0.9%. The company carries a Zacks Rank of 2.
Looking for Stocks with Skyrocketing Upside?
Zacks has just released a Special Report on the booming investment opportunities of legal marijuana.
Ignited by new referendums and legislation, this industry is expected to blast from an already robust $6.7 billion to $20.2 billion in 2021. Early investors stand to make a killing, but you have to be ready to act and know just where to look.
See the pot trades we're targeting>>
Zacks Names "Single Best Pick to Double"
From thousands of stocks, 5 Zacks experts each have chosen their favorite to skyrocket +100% or more in months to come. From those 5, Director of Research Sheraz Mian hand-picks one to have the most explosive upside of all.
It’s a little-known chemical company that’s up 65% over last year, yet still dirt cheap. With unrelenting demand, soaring 2022 earnings estimates, and $1.5 billion for repurchasing shares, retail investors could jump in at any time.
This company could rival or surpass other recent Zacks’ Stocks Set to Double like Boston Beer Company which shot up +143.0% in little more than 9 months and NVIDIA which boomed +175.9% in one year.
Free: See Our Top Stock and 4 Runners Up >>
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