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DexCom's (DXCM) Direct-to-Watch Feature to Boost Its G7 System

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DexCom Inc. (DXCM - Free Report) recently introduced a new direct-to-Apple-Watch feature for its G7 continuous glucose monitor (CGM) users.

With the new feature, G7 is likely to be the first CGM device that can link to Apple Watch directly, negating the requirement for an iPhone to be carried around. By the end of second-quarter 2024, Dexcom intends a gradual launch for all iOS users worldwide.

Price Performance

For the past six months, DXCM’s shares have gained 17.3% compared with the industry’s rise of 9.5%. The S&P 500 increased 14.2% in the same time frame.

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Dexcom G7 CGM System

Since the international conference of Advanced Technologies and Treatments of Diabetes 2023, Dexcom has expanded access to its ground-breaking real-time CGM technology by introducing its best-in-class G7 sensor into 16 new markets. Patients with diabetes of any kind, including gestational, who are two years of age and older can use Dexcom G7. This wearable glucose meter can be worn day or night on the back of the upper arm for up to 10 days, and it requires replacement.

The Dexcom G7 CGM System is designed to be user-friendly, robust, and efficient. CGM uses a wearable sensor to continuously monitor your blood sugar levels. Without the inconvenience of fingersticks or scanning, Dexcom CGM Systems transmit your blood glucose readings in real time to a handheld receiver or smart device.

Patients can control their glucose and accomplish outcomes like a lower A1C and more time in range by making better decisions about what to eat, how much to exercise, and how to take their medications when they have simpler access to real-time CGM data.

The Dexcom G7 CGM sensor needs only 30 minutes to warm up, and there is a 12-hour grace period to replace finished sensors for a seamless transition between sessions. The alert settings on the system have also been improved.

The new direct-to-Apple-Watch feature for G7 will boost the sensor’s accessibility, driving better acceptance and reliability among its patient population. Moreover, it will allow to target a patient population using smartwatches, including Apple watches, for managing their health.

Industry Prospects

Per a report by MarketsandMarkets, the global digital diabetes management market was estimated to be $18.9 billion in 2023 and is expected to reach $35.8 billion by 2028 at a growth rate of 13.6%.

The market is being driven by escalating diabetes care solutions and technological developments that have made it possible to introduce highly adaptable solutions. Other significant drivers include the increasing popularity of the use of connected devices and apps as well as the growing adoption of cloud-based solutions.

Given the market potential, the improvement and innovation of new features for its CGM system are likely to provide a significant boost to Dexcom’s business.

Notable Developments

Dexcom recently announced the FDA clearance of its Stelo glucose biosensor, which is available over-the-counter to consumers without a prescription. Stelo's approval for non-prescription use would further facilitate this population's access to cutting-edge CGM technology.

In December 2023, Dexcom announced the Dexcom G7 CGM System connectivity with the t: slim X2 insulin pump by Tandem Diabetes Care in the United States, marking the first AID integration with the Dexcom G7 CGM.

Dexcom also unveiled its new state-of-the-art manufacturing facility located in Athenry Co. Galway. With the ability to produce millions of Dexcom rtCGM sensors annually, the new plant is likely to contribute to the betterment of diabetes patients throughout Europe, the Middle East, and Africa.

Zacks Rank & Other Stocks to Consider

DXCM carries a Zacks Rank #2 (Buy) at present.

Some other top-ranked stocks in the broader medical space are DaVita Inc. (DVA - Free Report) , Cardinal Health, Inc. (CAH - Free Report) and Cencora, Inc. (COR - Free Report) .

DaVita, sporting a Zacks Rank #1 (Strong Buy), has an estimated long-term growth rate of 12.1%. DVA’s earnings surpassed estimates in each of the trailing four quarters, with the average surprise being 35.6%. You can see the complete list of today’s Zacks #1 Rank stocks here.

DaVita’s shares have gained 58.3% compared with the industry’s 18.9% rise in the past year.

Cardinal Health, flaunting a Zacks Rank of 1 at present, has an estimated long-term growth rate of 14.2%. CAH’s earnings surpassed estimates in each of the trailing four quarters, with the average being 15.6%.

Cardinal Health has gained 51.9% compared with the industry’s 3.2% rise in the past year.

Cencora, carrying a Zacks Rank of 2 at present, has an estimated long-term growth rate of 9.8%. COR’s earnings surpassed estimates in each of the trailing four quarters, with the average surprise being 6.7%.

Cencora’s shares have rallied 51.5% compared with the industry’s 3.6% rise in the past year.


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