Taking everything into account, DXCM scores 7 out of 10 in our fundamental rating. DXCM was compared to 186 industry peers in the Health Care Equipment & Supplies industry. DXCM gets an excellent profitability rating and is at the same time showing great financial health properties. DXCM is not priced too expensively while it is growing strongly. Keep and eye on this one! With these ratings, DXCM could be worth investigating further for growth and quality investing!.

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1. Profitability

2. Health

3. Growth

4. Valuation

5. Dividend

1. Profitability

1.1 Basic Checks

In the past year DXCM was profitable.
In the past year DXCM had a positive cash flow from operations.
DXCM had positive earnings in each of the past 5 years.
In the past 5 years DXCM always reported a positive cash flow from operatings.

1.2 Ratios

The Return On Assets of DXCM (9.61%) is better than 93.01% of its industry peers.
With an excellent Return On Equity value of 26.44%, DXCM belongs to the best of the industry, outperforming 97.31% of the companies in the same industry.
DXCM has a Return On Invested Capital of 15.72%. This is amongst the best in the industry. DXCM outperforms 95.70% of its industry peers.
Measured over the past 3 years, the Average Return On Invested Capital for DXCM is above the industry average of 8.84%.
The 3 year average ROIC (11.25%) for DXCM is below the current ROIC(15.72%), indicating increased profibility in the last year.

		Industry Rank	Sector Rank
ROA	9.61%
ROE	26.44%
ROIC	15.72%

ROA(3y)7.95%

ROA(5y)8.21%

ROE(3y)23.2%

ROE(5y)22.06%

ROIC(3y)11.25%

ROIC(5y)9.23%

1.3 Margins

DXCM's Profit Margin of 15.96% is amongst the best of the industry. DXCM outperforms 92.47% of its industry peers.
DXCM's Profit Margin has improved in the last couple of years.
DXCM's Operating Margin of 18.41% is amongst the best of the industry. DXCM outperforms 90.32% of its industry peers.
In the last couple of years the Operating Margin of DXCM has grown nicely.
DXCM's Gross Margin of 60.20% is fine compared to the rest of the industry. DXCM outperforms 61.29% of its industry peers.
DXCM's Gross Margin has been stable in the last couple of years.

		Industry Rank	Sector Rank
OM	18.41%
PM (TTM)	15.96%
GM	60.2%

OM growth 3Y10.52%

OM growth 5Y8.87%

PM growth 3Y17.27%

PM growth 5Y15.84%

GM growth 3Y-3.98%

GM growth 5Y-0.72%

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ROA

ROE

ROIC

Operating and Profit Margin

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2. Health

2.1 Basic Checks

The Return on Invested Capital (ROIC) is just above the Cost of Capital (WACC), so DXCM is still creating some value.
The number of shares outstanding for DXCM has been increased compared to 1 year ago.
DXCM has more shares outstanding than it did 5 years ago.
DXCM has a better debt/assets ratio than last year.

2.2 Solvency

DXCM has an Altman-Z score of 5.30. This indicates that DXCM is financially healthy and has little risk of bankruptcy at the moment.
The Altman-Z score of DXCM (5.30) is better than 77.42% of its industry peers.
The Debt to FCF ratio of DXCM is 2.36, which is a good value as it means it would take DXCM, 2.36 years of fcf income to pay off all of its debts.
DXCM has a better Debt to FCF ratio (2.36) than 85.48% of its industry peers.
DXCM has a Debt/Equity ratio of 0.47. This is a healthy value indicating a solid balance between debt and equity.
The Debt to Equity ratio of DXCM (0.47) is comparable to the rest of the industry.

		Industry Rank	Sector Rank
Debt/Equity	0.47
Debt/FCF	2.36
Altman-Z	5.3

ROIC/WACC1.64

WACC9.61%

2.3 Liquidity

A Current Ratio of 1.56 indicates that DXCM should not have too much problems paying its short term obligations.
DXCM has a worse Current ratio (1.56) than 71.51% of its industry peers.
A Quick Ratio of 1.38 indicates that DXCM should not have too much problems paying its short term obligations.
DXCM has a worse Quick ratio (1.38) than 60.22% of its industry peers.
DXCM does not score too well on the current and quick ratio evaluation. However, as it has excellent solvency and profitability, these ratios do not necessarly indicate liquidity issues and need to be evaluated against the specifics of the business.

		Industry Rank	Sector Rank
Current Ratio	1.56
Quick Ratio	1.38

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WACC

Debt/Equity

How to determine the health of a company

Altman-Z score

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3. Growth

3.1 Past

DXCM shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 9.41%, which is quite good.
DXCM shows a strong growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 29.25% yearly.
The Revenue has grown by 14.21% in the past year. This is quite good.
The Revenue has been growing by 22.27% on average over the past years. This is a very strong growth!

EPS 1Y (TTM)9.41%

EPS 3Y35.38%

EPS 5Y29.25%

EPS Q2Q%35.56%

Revenue 1Y (TTM)14.21%

Revenue growth 3Y18.1%

Revenue growth 5Y22.27%

Sales Q2Q%21.64%

3.2 Future

DXCM is expected to show a strong growth in Earnings Per Share. In the coming years, the EPS will grow by 22.05% yearly.
DXCM is expected to show quite a strong growth in Revenue. In the coming years, the Revenue will grow by 13.28% yearly.

EPS Next Y27.38%

EPS Next 2Y23.51%

EPS Next 3Y22.59%

EPS Next 5Y22.05%

Revenue Next Year15.38%

Revenue Next 2Y14.05%

Revenue Next 3Y13.59%

Revenue Next 5Y13.28%

3.3 Evolution

The estimated forward EPS growth is still strong, although it is decreasing when compared to the stronger growth in the past years.
Although the future Revenue growth is still strong, it is not able to hold up the even more excellent growth rate of the past years.

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4. Valuation

4.1 Price/Earnings Ratio

With a Price/Earnings ratio of 39.74, DXCM can be considered very expensive at the moment.
DXCM's Price/Earnings ratio is a bit cheaper when compared to the industry. DXCM is cheaper than 70.43% of the companies in the same industry.
Compared to an average S&P500 Price/Earnings ratio of 27.30, DXCM is valued a bit more expensive.
A Price/Forward Earnings ratio of 29.37 indicates a quite expensive valuation of DXCM.
Based on the Price/Forward Earnings ratio, DXCM is valued a bit cheaper than 72.58% of the companies in the same industry.
The average S&P500 Price/Forward Earnings ratio is at 24.32. DXCM is valued slightly more expensive when compared to this.

		Industry Rank	Sector Rank
PE	39.74
Fwd PE	29.37

4.2 Price Multiples

Compared to the rest of the industry, the Enterprise Value to EBITDA ratio of DXCM indicates a somewhat cheap valuation: DXCM is cheaper than 73.66% of the companies listed in the same industry.
82.26% of the companies in the same industry are more expensive than DXCM, based on the Price/Free Cash Flow ratio.

		Industry Rank	Sector Rank
P/FCF	27.15
EV/EBITDA	24.66

4.3 Compensation for Growth

DXCM's PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a correct valuation of the company.
The excellent profitability rating of DXCM may justify a higher PE ratio.
DXCM's earnings are expected to grow with 22.59% in the coming years. This may justify a more expensive valuation.