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Thursday, 03/09/2023 1:44:08 PM

Thursday, March 09, 2023 1:44:08 PM

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DexCom - >>> DexCom (DXCM) has constructed a robust revenue-producing and profitable business in the lucrative diabetes care market with its industry-leading continuous glucose monitoring (CGM) devices. The company recently saw the latest generation of its flagship CGM device, the G7, receive the green light from the FDA, and launches of the product are already underway in key global markets, including Europe and Asia.

The G7 device is being marketed as having the fastest warmup time of any such device to date, at only 30 minutes total. It's also 60% smaller than its predecessor, DexCom's top-selling CGM, the G6. Like the G6, the G7 CGM doesn't require any finger sticks, and it sends readings to the wearer's compatible device every five minutes in order to enable seamless tracking of blood sugar levels and trends. Although the launch is only in its early days, management said in the 2022 earnings call that "97% of initial users surveyed have found the G7 easy to use."

Moreover, as of the end of 2022, 1.7 million people around the globe were wearing a DexCom device, an increase of an incredible 450,000 lives compared to 2021. DexCom's revenue shot up 20% in 2022, while earnings surged nearly 60%. Given the ongoing expansion of public and private coverage for current and prospective CGM wearers -- including a recent U.S. ruling extending G7 coverage to Medicare beneficiaries who meet eligibility -- DexCom still has a broad, growing addressable market to tap into today.

There are millions of type 1 and type 2 diabetics around the globe who could benefit from such a device but are not yet wearing one. And the prevalence of diabetes is on the rise. There's also data to indicate that pre-diabetics may benefit from wearing CGMs. In short, there's a lot of growth runway left for DexCom here, and investors who stay with this stock for the long haul could tap into this growth story, too.



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