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Here's Why You Should Hold DexCom Stock in Your Portfolio for Now
Read MoreHide Full Article
Key Takeaways
DexCom delivered double-digit Q3 growth and raised full-year guidance on strong CGM demand.
Expanded U.S. and international reimbursement is fueling broader CGM adoption and patient starts.
New software, G7, One , and Stelo launches are boosting engagement and supporting long-term growth.
DexCom, Inc. (DXCM - Free Report) is well-poised for growth in the coming quarters, backed by a huge potential in the continuous glucose monitoring (CGM) market. A strong third-quarter 2025 performance and a series of favorable coverage decisions are expected to contribute further. However, risks related to stiff competition persist.
This Zacks Rank #3 (Hold) company’s shares have lost 18.1% year to date against the industry’s 16.8% growth. The S&P 500 Index has gained 16.3% in the same time frame.
DXCM, a renowned medical device company and provider of continuous glucose monitoring (CGM) systems, has a market capitalization of $25.64 billion. It projects a 22.5% growth rate over the next five years and anticipates maintaining a strong performance going forward.
DexCom’s earnings surpassed the Zacks Consensus Estimate in two of the trailing four quarters and missed twice, the average surprise being 0.17%.
Image Source: Zacks Investment Research
Let’s delve deeper.
CGM Market Represents a Huge Potential: The diabetes market offers massive long-term growth potential, with over 130 million people in the United States living with diabetes or prediabetes and more than 400 million affected globally, a figure expected to rise. This expanding patient base is driving strong demand for CGM devices, which help reduce hospitalizations, complications and overall treatment costs through real-time, user-friendly glucose tracking.
CGMs also enable more personalized diabetes management by allowing clinicians to tailor treatment plans based on individual data, while growing awareness and diagnosis of prediabetes further expands the addressable market. With the global CGM market projected to grow at nearly a 10% CAGR from over $6 billion today to about $14 billion by 2032, DexCom, as a leading CGM provider, is well-positioned to deliver sustained growth over the next decade, driven by rising adoption and deeper market penetration.
Product Ecosystem and Innovation Driving Adoption: DexCom generates nearly 90% of its revenues from disposable CGM sensors, supported by high demand thanks to strong product performance and user experience. The uptake of the G7 and One+ continues to accelerate, driven by broader insurance coverage, international expansion and growing physician support, especially among Type 2 diabetes patients.
Benefits like continuous readings without finger-pricking, comfortable wearability, and integrated alerts make DexCom’s systems compelling versus traditional glucose meters. The devices also connect to automated insulin delivery systems, which are becoming a key differentiator as diabetes care shifts toward smarter, closed-loop management.
Beyond hardware, DexCom’s software ecosystem is emerging as a powerful growth catalyst. New features such as historical data review, AI-powered insights and deeper integration with platforms like Oura are helping patients better understand glucose trends and improve health decisions. This increases engagement and strengthens the company’s reimbursement case.
Stelo, launched in 2024, has already surpassed $100 million in its first year across Type 2, prediabetes and wellness markets, supported by strong subscription renewals and upcoming Amazon distribution. Together, smarter software, expanding access and strong product uptake position DexCom for sustained adoption and long-term growth.
Strong Q3 Results: DexCom posted a strong third-quarter performance, delivering double-digit revenue growth and raising its full-year outlook as the company continues to expand CGM access and scale its innovation pipeline. Management noted that U.S. growth was driven by rising adoption among the rapidly expanding type 2 diabetes population, especially non-insulin and basal users, supported by deeper penetration into primary care and broader commercial reimbursement.
International momentum also strengthened for a third straight quarter, with France and Canada emerging as key contributors following recent reimbursement gains tied to basal eligibility, while DexCom ONE+ helped bolster competitiveness in more price-sensitive European markets.
Downsides
Stiff Competition: Rising competition in the Type 1 diabetes market, particularly from pump-integrated CGM systems, adds pressure. Additionally, the leadership transition in the U.S. commercial team introduces potential risks to execution as DexCom navigates these dynamics. While challenges persist, the company’s strategic initiatives and innovation-driven approach position it well for sustained growth.
Estimate Trend
DexCom has witnessed a stable estimate revision trend for 2025. In the past 60 days, the Zacks Consensus Estimate for 2025 earnings per share has moved up 1 cent to $2.07.
The consensus mark for the company’s fourth-quarter revenues is pegged at $1.24 billion, indicating an 11.6% improvement from the year-ago quarter’s reported number. The consensus estimate for fourth-quarter earnings is pinned at 65 cents per share, implying an improvement of 44.4% year over year.
Stocks to Consider
Some better-ranked stocks from the broader medical space are Medpace Holdings (MEDP - Free Report) , Intuitive Surgical (ISRG - Free Report) and Boston Scientific (BSX - Free Report) .
Medpace, currently carrying a Zacks Rank #2 (Buy), reported a third-quarter 2025 earnings per share (EPS) of $3.86, which surpassed the Zacks Consensus Estimate by 10.29%. Revenues of $659.9 million beat the Zacks Consensus Estimate by 3.04%. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
MEDP has an estimated earnings growth rate of 17.1% for 2025 compared with the industry’s 16.6% growth. The company beat earnings estimates in each of the trailing four quarters, the average surprise being 14.28%.
Intuitive Surgical, sporting a Zacks Rank #1 at present, posted a third-quarter 2025 adjusted EPS of $2.40, exceeding the Zacks Consensus Estimate by 20.6%. Revenues of $2.51 billion topped the Zacks Consensus Estimate by 3.9%.
ISRG has an estimated long-term earnings growth rate of 15.7% compared with the industry’s 11.9% growth. The company’s earnings outpaced estimates in each of the trailing four quarters, the average surprise being 16.34%.
Boston Scientific, currently carrying a Zacks Rank #2, reported a third-quarter 2025 adjusted EPS of 75 cents, which surpassed the Zacks Consensus Estimate by 5.6%. Revenues of $5.07 billion outperformed the Zacks Consensus Estimate by 1.9%.
BSX has an estimated long-term earnings growth rate of 16.4% compared with the industry’s 13.5% growth. The company’s earnings beat estimates in each of the trailing four quarters, the average surprise being 7.36%.
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Here's Why You Should Hold DexCom Stock in Your Portfolio for Now
Key Takeaways
DexCom, Inc. (DXCM - Free Report) is well-poised for growth in the coming quarters, backed by a huge potential in the continuous glucose monitoring (CGM) market. A strong third-quarter 2025 performance and a series of favorable coverage decisions are expected to contribute further. However, risks related to stiff competition persist.
This Zacks Rank #3 (Hold) company’s shares have lost 18.1% year to date against the industry’s 16.8% growth. The S&P 500 Index has gained 16.3% in the same time frame.
DXCM, a renowned medical device company and provider of continuous glucose monitoring (CGM) systems, has a market capitalization of $25.64 billion. It projects a 22.5% growth rate over the next five years and anticipates maintaining a strong performance going forward.
DexCom’s earnings surpassed the Zacks Consensus Estimate in two of the trailing four quarters and missed twice, the average surprise being 0.17%.
Image Source: Zacks Investment Research
Let’s delve deeper.
CGM Market Represents a Huge Potential: The diabetes market offers massive long-term growth potential, with over 130 million people in the United States living with diabetes or prediabetes and more than 400 million affected globally, a figure expected to rise. This expanding patient base is driving strong demand for CGM devices, which help reduce hospitalizations, complications and overall treatment costs through real-time, user-friendly glucose tracking.
CGMs also enable more personalized diabetes management by allowing clinicians to tailor treatment plans based on individual data, while growing awareness and diagnosis of prediabetes further expands the addressable market. With the global CGM market projected to grow at nearly a 10% CAGR from over $6 billion today to about $14 billion by 2032, DexCom, as a leading CGM provider, is well-positioned to deliver sustained growth over the next decade, driven by rising adoption and deeper market penetration.
Product Ecosystem and Innovation Driving Adoption: DexCom generates nearly 90% of its revenues from disposable CGM sensors, supported by high demand thanks to strong product performance and user experience. The uptake of the G7 and One+ continues to accelerate, driven by broader insurance coverage, international expansion and growing physician support, especially among Type 2 diabetes patients.
Benefits like continuous readings without finger-pricking, comfortable wearability, and integrated alerts make DexCom’s systems compelling versus traditional glucose meters. The devices also connect to automated insulin delivery systems, which are becoming a key differentiator as diabetes care shifts toward smarter, closed-loop management.
Beyond hardware, DexCom’s software ecosystem is emerging as a powerful growth catalyst. New features such as historical data review, AI-powered insights and deeper integration with platforms like Oura are helping patients better understand glucose trends and improve health decisions. This increases engagement and strengthens the company’s reimbursement case.
Stelo, launched in 2024, has already surpassed $100 million in its first year across Type 2, prediabetes and wellness markets, supported by strong subscription renewals and upcoming Amazon distribution. Together, smarter software, expanding access and strong product uptake position DexCom for sustained adoption and long-term growth.
Strong Q3 Results: DexCom posted a strong third-quarter performance, delivering double-digit revenue growth and raising its full-year outlook as the company continues to expand CGM access and scale its innovation pipeline. Management noted that U.S. growth was driven by rising adoption among the rapidly expanding type 2 diabetes population, especially non-insulin and basal users, supported by deeper penetration into primary care and broader commercial reimbursement.
International momentum also strengthened for a third straight quarter, with France and Canada emerging as key contributors following recent reimbursement gains tied to basal eligibility, while DexCom ONE+ helped bolster competitiveness in more price-sensitive European markets.
Downsides
Stiff Competition: Rising competition in the Type 1 diabetes market, particularly from pump-integrated CGM systems, adds pressure. Additionally, the leadership transition in the U.S. commercial team introduces potential risks to execution as DexCom navigates these dynamics. While challenges persist, the company’s strategic initiatives and innovation-driven approach position it well for sustained growth.
Estimate Trend
DexCom has witnessed a stable estimate revision trend for 2025. In the past 60 days, the Zacks Consensus Estimate for 2025 earnings per share has moved up 1 cent to $2.07.
The consensus mark for the company’s fourth-quarter revenues is pegged at $1.24 billion, indicating an 11.6% improvement from the year-ago quarter’s reported number. The consensus estimate for fourth-quarter earnings is pinned at 65 cents per share, implying an improvement of 44.4% year over year.
Stocks to Consider
Some better-ranked stocks from the broader medical space are Medpace Holdings (MEDP - Free Report) , Intuitive Surgical (ISRG - Free Report) and Boston Scientific (BSX - Free Report) .
Medpace, currently carrying a Zacks Rank #2 (Buy), reported a third-quarter 2025 earnings per share (EPS) of $3.86, which surpassed the Zacks Consensus Estimate by 10.29%. Revenues of $659.9 million beat the Zacks Consensus Estimate by 3.04%. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
MEDP has an estimated earnings growth rate of 17.1% for 2025 compared with the industry’s 16.6% growth. The company beat earnings estimates in each of the trailing four quarters, the average surprise being 14.28%.
Intuitive Surgical, sporting a Zacks Rank #1 at present, posted a third-quarter 2025 adjusted EPS of $2.40, exceeding the Zacks Consensus Estimate by 20.6%. Revenues of $2.51 billion topped the Zacks Consensus Estimate by 3.9%.
ISRG has an estimated long-term earnings growth rate of 15.7% compared with the industry’s 11.9% growth. The company’s earnings outpaced estimates in each of the trailing four quarters, the average surprise being 16.34%.
Boston Scientific, currently carrying a Zacks Rank #2, reported a third-quarter 2025 adjusted EPS of 75 cents, which surpassed the Zacks Consensus Estimate by 5.6%. Revenues of $5.07 billion outperformed the Zacks Consensus Estimate by 1.9%.
BSX has an estimated long-term earnings growth rate of 16.4% compared with the industry’s 13.5% growth. The company’s earnings beat estimates in each of the trailing four quarters, the average surprise being 7.36%.