Why NASDAQ:DXCM Is a Standout High-Growth Stock in a Consolidation Phase.

Last update: Jun 24, 2024

For growth-minded investors, high revenue and EPS growth are key criteria. Today, we'll examine whether DEXCOM INC (NASDAQ:DXCM) fits the bill for growth investing, particularly as it forms a base and hints at a potential breakout. Remember, due diligence is essential, but DEXCOM INC has caught our attention on our screen for growth with base formation. It may warrant additional investigation.

Exploring NASDAQ:DXCM's Growth

ChartMill assigns a proprietary Growth Rating to each stock. The score is computed by evaluating various growth aspects, like EPS and revenue growth. We take into account the history as well as the estimated future numbers. NASDAQ:DXCM was assigned a score of 9 for growth:

DXCM shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 72.92%, which is quite impressive.
Measured over the past years, DXCM shows a very strong growth in Earnings Per Share. The EPS has been growing by 83.54% on average per year.
The Revenue has grown by 25.78% in the past year. This is a very strong growth!
DXCM shows a strong growth in Revenue. Measured over the last years, the Revenue has been growing by 28.56% yearly.
DXCM is expected to show a strong growth in Earnings Per Share. In the coming years, the EPS will grow by 21.67% yearly.
Based on estimates for the next years, DXCM will show a quite strong growth in Revenue. The Revenue will grow by 17.04% on average per year.

Health Analysis for NASDAQ:DXCM

ChartMill employs a unique Health Rating system for all stocks. This rating, ranging from 0 to 10, is determined by analyzing various liquidity and solvency ratios. For NASDAQ:DXCM, the assigned 6 for health provides valuable insights:

DXCM has an Altman-Z score of 8.31. This indicates that DXCM is financially healthy and has little risk of bankruptcy at the moment.
With an excellent Altman-Z score value of 8.31, DXCM belongs to the best of the industry, outperforming 85.11% of the companies in the same industry.
DXCM's Debt to FCF ratio of 4.27 is amongst the best of the industry. DXCM outperforms 82.98% of its industry peers.
A Current Ratio of 2.90 indicates that DXCM has no problem at all paying its short term obligations.
A Quick Ratio of 2.53 indicates that DXCM has no problem at all paying its short term obligations.

Profitability Examination for NASDAQ:DXCM

ChartMill assigns a proprietary Profitability Rating to each stock. The score is computed by evaluating various profitability ratios and margins and ranges from 0 to 10. NASDAQ:DXCM was assigned a score of 8 for profitability:

DXCM's Return On Assets of 9.86% is amongst the best of the industry. DXCM outperforms 93.09% of its industry peers.
DXCM has a better Return On Equity (28.45%) than 97.87% of its industry peers.
With an excellent Return On Invested Capital value of 11.18%, DXCM belongs to the best of the industry, outperforming 92.55% of the companies in the same industry.
The 3 year average ROIC (8.57%) for DXCM is below the current ROIC(11.18%), indicating increased profibility in the last year.
Looking at the Profit Margin, with a value of 16.82%, DXCM belongs to the top of the industry, outperforming 93.62% of the companies in the same industry.
DXCM has a better Operating Margin (17.58%) than 92.02% of its industry peers.
DXCM has a Gross Margin of 63.25%. This is in the better half of the industry: DXCM outperforms 62.23% of its industry peers.

How do we evaluate the setup for NASDAQ:DXCM?

Alongside the Technical Rating, ChartMill assigns a Setup Rating to evaluate the consolidation level of a stock. This rating, ranging from 0 to 10, is updated daily and considers various short-term technical indicators. The current setup rating for NASDAQ:DXCM is 8:

Although the technical rating is bad, DXCM does present a nice setup opportunity. We see reduced volatility while prices have been consolidating in the most recent period. There is a resistance zone just above the current price starting at 116.64. Right above this resistance zone may be a good entry point. There is a support zone below the current price at 116.21, a Stop Loss order could be placed below this zone.

Every day, new Strong Growth stocks can be found on ChartMill in our Strong Growth screener.

For an up to date full fundamental analysis you can check the fundamental report of DXCM

Check the latest full technical report of DXCM for a complete technical analysis.

Keep in mind

This article should in no way be interpreted as advice. The article is based on the observed metrics at the time of writing, but you should always make your own analysis and trade or invest at your own responsibility.