Advertisement
Australia markets close in 2 hours 24 minutes

  • ALL ORDS

    7,850.20
    -87.30 (-1.10%)
     

  • ASX 200

    7,588.20
    -94.80 (-1.23%)
     

  • AUD/USD

    0.6522
    -0.0001 (-0.02%)
     

  • OIL

    83.79
    +0.22 (+0.26%)
     

  • GOLD

    2,345.00
    +2.50 (+0.11%)
     

  • Bitcoin AUD

    98,777.52
    +23.32 (+0.02%)
     

  • CMC Crypto 200

    1,390.10
    +7.52 (+0.54%)
     

  • AUD/EUR

    0.6080
    +0.0007 (+0.11%)
     

  • AUD/NZD

    1.0948
    -0.0009 (-0.08%)
     

  • NZX 50

    11,834.35
    -112.08 (-0.94%)
     

  • NASDAQ

    17,430.50
    -96.30 (-0.55%)
     

  • FTSE

    8,078.86
    +38.48 (+0.48%)
     

  • Dow Jones

    38,085.80
    -375.12 (-0.98%)
     

  • DAX

    17,917.28
    -171.42 (-0.95%)
     

  • Hang Seng

    17,596.73
    +312.19 (+1.81%)
     

  • NIKKEI 225

    37,780.35
    +151.87 (+0.40%)
     

DexCom (DXCM) Q1 Earnings and Revenues Surpass Estimates

Zacks Equity Research
·4-min read

DexCom, Inc. DXCM reported adjusted earnings of 44 cents per share in first-quarter 2020, which comfortably surpassed the Zacks Consensus Estimate of 10 cents. Notably, the company has reported a loss per share of 5 cents in the prior-year quarter.

Total revenues surged 44.4% to $405.1 million on a year-over-year basis and also beat the Zacks Consensus Estimate by 14%. Rising volumes across all channels, strong new patient additions and increasing global awareness of the benefits of real-time Continuous Glucose Monitoring (CGM) contributed to the upside.

Segmental Details

Revenues at the Sensor and other revenue segment (80% of total revenues) surged 53.4% on a year-over-year basis to $325 million. Hardware revenues (20%) improved 16.8% year over year to $80.1 million.

Geographical Details

U.S. revenues (81% of total revenues) increased 38.9% on a year-over-year basis to $292.3 million. International revenues (19%) surged 61.1% year over year to $112.8 million.

DexCom, Inc. Price, Consensus and EPS Surprise

 

DexCom, Inc. Price, Consensus and EPS Surprise
DexCom, Inc. Price, Consensus and EPS Surprise

DexCom, Inc. price-consensus-eps-surprise-chart | DexCom, Inc. Quote

ADVERTISEMENT

Margin Analysis

Gross profit in the quarter under review totaled $256.5 million, up 51.9% year over year. However, DexCom generated gross margin (as a percentage of revenues) of 63.3%, which expanded 310 bps year over year.

Research and development expenses amounted to $73.1 million in the quarter, up 23.9% year over year. Selling, general and administrative expenses totaled $149.8 million in the reported quarter, up 20.6% year over year.

The company reported total operating expenses of $222.9 million, up 21.7% year over year.

The company reported operating income of $33.6 million, against the year-ago quarter’s operating loss of $14.4 million.

Financial Position

The company exited the first quarter with $584.6 million in cash and cash equivalents, which surged 31% from year-end 2019.

2020 Guidance

The company has decided to suspend full-year 2020 guidance (issued previously on Feb 13, 2020) on account of the uncertainty with respect to the duration and impact of the COVID-19 pandemic.

Wrapping Up

DexCom exited the first quarter on a strong note, wherein both earnings and revenues beat the Zacks Consensus Estimate. Impressive contributions from the segments were key catalysts. Expansion in gross margin is a positive.

Additionally, the glucose monitoring market presents significant commercial opportunity for this company. DexCom’s opportunities in alternative markets such as the non-intensive diabetes management space, the hospital, gestational, pre-diabetes and obesity are likely to provide it a competitive edge in the MedTech space.

However, due to the uncertainty surrounding the COVID-19 pandemic, the company has suspended full-year 2020 guidance. Meanwhile, cut-throat competition in the market for blood & glucose monitoring devices remains a concern.

Zacks Rank

Currently, DexCom carries a Zacks Rank of 3 (Hold).

Key Picks

Some better-ranked stocks in the broader medical space are Exact Sciences Corporation EXAS, ViewRay, Inc. VRAY and ResMed Inc. RMD, each carrying a Zacks Rank of 2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

The Zacks Consensus Estimate for Exact Sciences’s first-quarter 2020 revenues is pegged at $350.2 million, suggesting a whopping year-over-year improvement of 116.1%. The same for EPS stands at a loss of 60 cents, indicating growth of 9.1% from the prior-year quarter.

The Zacks Consensus Estimate for ViewRay’s first-quarter 2020 earnings per share stands at a loss of 20 cents, suggesting an improvement of 41.8% from the year-ago period.

The Zacks Consensus Estimate for ResMed’s third-quarter fiscal 2020 revenues is pegged at $715.6 million, suggesting year-over-year improvement of 8.1%. The same for EPS stands at $1.00, indicating growth of 12.4% from the year-ago reported figure.

Zacks Top 10 Stocks for 2020

In addition to the stocks discussed above, would you like to know about our 10 finest buy-and-hold tickers for the entirety of 2020?

Last year's 2019 Zacks Top 10 Stocks portfolio returned gains as high as +102.7%. Now a brand-new portfolio has been handpicked from over 4,000 companies covered by the Zacks Rank. Don’t miss your chance to get in on these long-term buys.

Access Zacks Top 10 Stocks for 2020 today >>


Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report
 
DexCom, Inc. (DXCM) : Free Stock Analysis Report
 
ResMed Inc. (RMD) : Free Stock Analysis Report
 
Exact Sciences Corporation (EXAS) : Free Stock Analysis Report
 
ViewRay, Inc. (VRAY) : Free Stock Analysis Report
 
To read this article on Zacks.com click here.
 
Zacks Investment Research