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[Updated: 6/22/2021] DXCM Stock Rise

Last month, we discussed why the sell-off in Dexcom Stock (NASDAQ: DXCM) was unwarranted, and we expected it to see higher levels. Since then, DXCM stock has rallied 18%, while it is up 23% over the last twenty-one trading days. There were some positive developments for the company as well. The Centers For Medicare & Medicaid Services recently announced that there is no longer a requirement for a minimum of four self-monitoring blood glucose tests per day to have the continuous glucose monitoring devices covered. This step will result in better patient access, and bode well for companies such as Dexcom and Abbott that develop CGM devices with no requirement of finger-pricking.

Furthermore, Dexcom expects to launch its newest CGM device – G7 – later this year, and given that the new device will use a new and improved application, while it will also be 60% smaller in size compared to the current G6, making it the smallest CGM device available in the market. It has several other benefits over the current version, such as, its transmitter and sensor will be combined, making it a single fully disposable unit. It is also expected to have a longer wear time. As such, the G7 CGM will likely be more attractive to customers, and bolster Dexcom’s sales growth after its launch.

However, now that DXCM stock has seen a rise of 23% in twenty-one trading days, will it continue its upward trajectory, or is a fall imminent? Going by historical performance, there is a higher chance of a rise in DXCM stock over the next month. Out of 184 instances in the last ten years that Dexcom stock saw a twenty-one day rise of 23% or more, 99 of them resulted in DXCM stock rising over the subsequent one month period (twenty-one trading days). This historical pattern reflects 99 out of 184, or about 54% chance of a rise in DXCM stock over the coming month. Also, despite the recent rally, DXCM stock is up only 4% from the levels it was trading at a year ago. See our analysis on Dexcom Stock Chances of Rise for more details.

Calculation of ‘Event Probability’ and ‘Chance of Rise’ using last 10 year data

  1. 3.4% or higher return during five-day period in 794 times out of 2517; Stock rose in the next 5 days in 448 of these 794 instances
  2. 9.3% or higher return during ten-day period in 463 times out of 2517; Stock rose in the next 10 days in 260 of these 463 instances
  3. 23% or higher return during twenty-one day period in 184 times out of 2516; Stock rose in the next 21 days in 99 of these 184 instances

Predict average return on DexCom Stock Return: AI Predicts DXCM Average and Excess Return After a Fall or Rise

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DexCom Stock Return (Recent) Comparison With Peers

Five-Day Return: DXCM highest at 3.4%; SPY lowest at -1%

Ten-Day Return: DXCM highest at 9.3%; SPY lowest at -0.3%

Twenty-One Days Return: DXCM highest at 23%; ABT lowest at -5.4%

[Updated: 5/6/2021] DXCM Stock Decline

The stock price of Dexcom (NASDAQ: DXCM), best known for its continuous glucose monitoring systems, has seen an 11% drop over the last five trading days, and we believe the stock is likely to rebound in the near term. The recent drop is surprising, given that the company last week reported its Q1 numbers, which were actually above the street estimates. Dexcom’s Q1 sales of $505 million was higher than the $482 million consensus estimate. Similarly, its adjusted EPS of $0.33 was ahead of the $0.31 consensus estimate. Looking at the company’s guidance for revenue to be between $2.26 billion and $2.36 billion in 2021 is also in-line with the $2.33 billion consensus estimates. It’s not that the stock had seen a large rally. DXCM stock is up just 1% year-to-date, and it is at the same levels it was at a year back.

While there have been rumors of Apple coming up with a CGM feature in its Apple Watch, the company hasn’t confirmed it yet. That said, if Apple does come up with this feature, it will surely take a toll on companies such as Dexcom and Abbott, that sell the wearable CGM devices, especially if the data collected by Apple Watch is fully reliable. However, it’s not easy to secure the U.S. FDA regulatory approval for a wearable CGM device given that it expects the data to be comparable to the regular CGM devices. It seems unlikely at this stage that Apple may come up with a CGM feature to match the level of accuracy on other CGM devices, such as that of Dexcom and Abbott.

Looking at the recent decline, the 11% drop for DXCM stock over the last five days compares with just a 0.7% decline seen in the broader S&P 500 index. Now, is DXCM stock poised to drop further? It doesn’t appears so. Given the large underperformance over the recent past, and based on our machine learning analysis of trends in the stock price over the last few years, we believe that there is a 64% chance of a rise in DXCM stock over the next month (twenty-one trading days).

Out of 75 instances in the last ten years that Dexcom stock saw a five-day decline of 11% or more, 48 of them resulted in DXCM stock rising over the subsequent one month period (21 trading days). This historical pattern reflects 48 out of 75, or about a 64% chance of gain in DXCM stock over the coming month. See our analysis on Dexcom Stock Chances of Rise for more details.

Five Days: DXCM -11%, vs. S&P500 -0.7%; Underperformed market

(3% likelihood event)

  • Dexcom stock declined 11% over a five-day trading period ending 5/5/2021, compared to the broader market (S&P500) decline of 0.7%
  • A change of -11% or more over five trading days is a 3% likelihood event, which has occurred 76 times out of 2516 in the last ten years.

Ten Days: DXCM -8.5%, vs. S&P500 0.4%; Underperformed market

(11% likelihood event)

  • Dexcom stock declined 8.5% over the last ten trading days (two weeks), compared to the broader market (S&P500) rise of 0.4%
  • A change of -8.5% or more over ten trading days is a 11% likelihood event, which has occurred 268 times out of 2511 in the last ten years.

Twenty-One Days: DXCM 5.4%, vs. S&P500 4.3%; Outperformed market

(44% likelihood event)

  • Dexcom stock rose 5.4% the last twenty-one trading days (1 month), compared to the broader market (S&P500) rise of 4.3%
  • A change of 5.4% or more over twenty-one trading days is a 44% likelihood event, which has occurred 1107 times out of 2500 in the last ten years.

While DXCM stock can see a rebound, it is helpful to see how its peers stack up. Check out Dexcom Stock Comparison With Peers to see how DXCM stock compares against peers on metrics that matter. You can find more such useful comparisons on Peer Comparisons.

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