Dexcom’s Strategic Growth and Market Expansion Justifies Buy Rating

Jefferies analyst Matthew Taylor maintained a Buy rating on Dexcom (DXCM – Research Report) yesterday and set a price target of $110.00.

Matthew Taylor has given his Buy rating due to a combination of factors influencing Dexcom’s current and future market position. Dexcom has shown strong recovery and growth following a challenging period, achieving record new starts over the past three quarters and receiving FDA approval for its 15-day continuous glucose monitoring (CGM) system. This approval, coupled with the company’s efforts to expand its total addressable market (TAM) by targeting Type 2 non-insulin patients, positions Dexcom for significant revenue growth.
Furthermore, the potential for broader coverage, including pre-diabetic and gestational indications, enhances Dexcom’s growth prospects. The transition to the 15-day CGM system is expected to improve margins significantly, as it could reduce the cost of goods sold by approximately one-third. With Dexcom’s strategic initiatives and favorable market dynamics, Taylor sees a compelling risk/reward profile, justifying the Buy rating.

According to TipRanks, Taylor is a 5-star analyst with an average return of 7.9% and a 56.79% success rate. Taylor covers the Healthcare sector, focusing on stocks such as Dexcom, Edwards Lifesciences, and Insulet.

In another report released today, Goldman Sachs also initiated coverage with a Buy rating on the stock with a $104.00 price target.