Raymond James Raises Dexcom's Price Target on Record-Breaking User Growth

Raymond James's Jayson Bedford raised their price target on Dexcom (NASDAQ: DXCM) by 6% from $151 to $160 on 2024/04/26. The analyst maintained their Strong Buy rating on the stock.

Bedford's optimistic outlook for Dexcom comes after the company reported impressive Q1 2024 results, which showcased a record-breaking number of new users. The robust user growth is seen as a strong indicator of future revenue growth and has led to management revising their revenue guidance for the year.

In the first quarter of 2024, Dexcom reported earnings per share (EPS) of $0.32, surpassing the Zacks Consensus Estimate of $0.27. This represented an 88% increase compared to the same period last year, when EPS stood at $0.17. The company's revenue for the quarter was $921 million, in line with the Zacks Consensus Estimate and a 24% increase compared to Q1 2023's revenue of $741.5 million.

Looking ahead, Dexcom's management updated their guidance for FY 2024. They now expect revenue in the range of $4.2 billion to $4.35 billion, with a gross profit margin of 63% to 64% and an EBITDA margin of 29%.

President and CEO Kevin Sayer expressed his satisfaction with the company's performance, stating, "Dexcom is off to a great start in 2024, delivering another quarter of strong financial results while advancing several key strategic initiatives. This is shaping up to be another exciting year for Dexcom as we launch new product innovations and work to improve access to Dexcom CGM around the world."

Following the impressive Q1 results, analyst William Plovanic from Canaccord Genuity also issued an update on Dexcom on April 26th. Plovanic raised their price target by 0.7%, from $144 to $145, while maintaining their Strong Buy rating on the stock.

When considering the overall analyst sentiment on Dexcom, 75% of top-rated analysts currently rate the stock as a Strong Buy or Buy. Only 25% see it as a Hold, with no analysts recommending or strongly recommending selling the stock.

The consensus forecast among analysts is that Dexcom's upcoming year will deliver earnings per share (EPS) of $1.74. If the analysts' predictions hold true, this would represent a 5.4% increase on a year-over-year basis.

Despite the positive analyst ratings and strong Q1 performance, Dexcom's stock price has faced some downward pressure. Since the company's latest quarterly report on April 25th, the stock price has declined by 9.9%. On a year-over-year basis, the stock is down 0.5%. During this period, Dexcom has underperformed the S&P 500, which has experienced a decline of 25.7%.

It is worth noting that Jayson Bedford, the analyst who raised Dexcom's price target, is ranked in the top 17% of Wall Street analysts by WallStreetZen. With an average return of 2.7% and a win rate of 44.4%, Bedford specializes in the Healthcare sector.

DexCom, Inc. is a medical device company that focuses on the design, development, and commercialization of continuous glucose monitoring (CGM) systems. These systems are used by people with diabetes and healthcare providers to monitor glucose levels. Dexcom's product lineup includes the DexCom G6, an integrated CGM system, and Dexcom Real-Time API, which allows third-party developers to integrate CGM data into their digital health applications and devices.

The company's latest product, the Dexcom G7, is a next-generation CGM system. DexCom, Inc. also has a collaboration and license agreement with Verily Life Sciences LLC and Verily Ireland Limited to develop blood-based or interstitial glucose monitoring products.

Dexcom markets its products directly to endocrinologists, physicians, and diabetes educators. Established in 1999, the company is headquartered in San Diego, California.

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