Here's Why You Should Retain DexCom Stock in Your Portfolio for Now

Core Insights - DexCom, Inc. (DXCM) is positioned for growth due to a strong product portfolio and better-than-expected Q3 2024 performance, despite facing stiff competition [1][11] - The company's shares have decreased by 36.5% year-to-date, contrasting with the industry's 6.7% growth and the S&P 500's 28.6% increase [1] Company Performance - DexCom has a market capitalization of $31.43 billion and projects a 19.1% growth over the next five years, maintaining strong performance [2] - The company has consistently surpassed earnings estimates, achieving an average surprise of 12.43% over the last four quarters [2] Product Demand and Innovation - Strong demand for continuous glucose monitoring (CGM) products was evident in Q3 2024, with record new patient starts and successful international launches of the G7 and DexCom ONE+ platforms [4] - The introduction of the Stelo Biosensor in the U.S. targets non-intensive insulin users, with over 50% of users opting for subscriptions, indicating potential for recurring revenue [4][6] Strategic Partnerships and Expansions - A partnership with OURA aims to integrate glucose biosensor data with biometric insights from the Oura Ring, with the first app integration expected in H1 2025 [5] - DexCom's expansion into the Type 2 diabetes market with the Stelo product is anticipated to support top-line growth [6] Coverage and Market Access - Significant expansion in global coverage occurred in Q3 2024, including the launch of DexCom ONE+ in France and national reimbursement for over 600,000 individuals [8] - Enhanced sales efforts in Japan and reimbursement wins across Europe have solidified DexCom's market presence [8] Financial Performance - Revenue growth of 2% in Q3 was driven by new patient performance and expanded product availability, with total revenue expectations for 2024 between$ 4 billion and $4.05 billion, reflecting an organic growth of 11-13% year-over-year [8] - The consensus estimate for Q4 revenues is$ 1.10 billion, indicating a 5.9% improvement year-over-year, with earnings expected to improve by 4% [12] Competitive Landscape - DexCom faces challenges from rebate pressures and competition in the Type 1 diabetes market, particularly from pump-integrated CGM systems [10][11] - Leadership transitions in the U.S. commercial team may introduce execution risks amid these competitive dynamics [11]