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DexCom (DXCM) to Report Q1 Earnings: What's in the Cards?

DexCom, Inc. DXCM is scheduled to release first-quarter 2023 results on Apr 27, after the closing bell. In the last reported quarter, the company’s earnings beat estimates by 30.77%.

The figure also beat the consensus mark in two of the trailing four quarters, missed once and met the same once, the average negative surprise being 2.86%.

Q1 Estimates

Currently, the Zacks Consensus Estimate for DexCom’s first-quarter revenues is pegged at $719.9 million, indicating growth of 14.5% from the year-ago reported figure. The same for earnings stands at 15 cents per share, implying an 87.5% improvement from that reported in the prior-year quarter.

Factors to Note

DexCom’s first-quarter revenues are likely to have been aided by continued increase in volume. This surge can be attributed to new patients across all channels and rising global awareness about the benefits of its real-time Continuous Glucose Monitoring (“CGM”).

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Potential robust contributions from the Sensor segment, and domestic and international revenue growth are likely to be the key catalysts for the company’s first-quarter results.

In 2022, DexCom continued expanding access and accelerating its leadership in CGM-connected solutions and customer choice. The company continues to launch the Dexcom ONE product in new countries. These developments are expected to have benefited customer growth in the soon-to-be-reported quarter.

In December 2022, DXCM received the FDA’s approval for the Dexcom G7 CGM system’s use in people with any type of diabetes, aged two years and older.

The company also secured the CE mark for the abovementioned system for monitoring diabetic patients aged two years and older, and initiated a limited launch of same in Europe in late 2022.

DexCom, Inc. Price and EPS Surprise

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

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

DexCom expanded coverage for its CGM system in Ontario, Canada, to include type 1 diabetes. Moreover, in January, Non-Insured Health Benefits Program extended its coverage for Dexcom G6 to include all clients with type I diabetes in British Columbia. These developments must have favored the company’s performance in the to-be-reported quarter.

DXCM has been benefiting from demographic trends and lifestyles in countries outside Europe and the United States. Per the company, international growth remains strong and presents lucrative opportunities, courtesy of improving global access and awareness.

In the fourth quarter of 2022, International revenues (26% of total revenues) surged 15% year over year to $208.8 million. Organically, the segment’s revenues were up 27% in the last reported quarter. U.S. revenues (74% of total revenues) increased 17% in the same period. The trend is likely to have continued in the first quarter of 2023, owing to broad-based growth.

The Zacks Consensus Estimate for U.S. and International revenues is pegged at $515 million and $205 million, respectively, for the first quarter.

However, an increase in operating expenses and intense competition might have weighed on the company’s performance in the quarter.

What Our Quantitative Model Suggests

Our proven model does not conclusively predict an earnings beat for DexCom this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the chances of an earnings beat. But that's not the case here. You can uncover the best stocks to buy or sell before they are reported with our Earnings ESP Filter.

Earnings ESP: DexCom’s Earnings ESP, which represents the difference between the Most Accurate Estimate and the Zacks Consensus Estimate, is 0.00%.

Zacks Rank: DexCom carries a Zacks Rank #2 at present.

Stocks Worth a Look

Here are a few medical stocks worth considering as these have the right combination of elements to come up with an earnings beat this reporting cycle:

Henry Schein HSIC has an Earnings ESP of +0.99% and a Zacks Rank of 2 at present. You can see the complete list of today’s Zacks #1 Rank stocks here.

HSIC has an estimated long-term growth rate of 8.1%. Henry Schein’s earnings surpassed estimates in three of the trailing four quarters and met the same once, the average surprise being 2.97%.

BioRad Laboratories BIO has an Earnings ESP of +0.16% and a Zacks Rank of 2 at present. BIO has an earnings yield of 3.3%, which compares favorably with the industry’s negative yield of 2.9%.

BioRad Laboratories’ earnings surpassed estimates in three of the trailing four quarters and missed the same once, the average surprise being 27.54%.

McKesson MCK has an Earnings ESP of +1.22% and a Zacks Rank #3 at present. MCK has an estimated long-term growth rate of 10.4%.

McKesson’s earnings surpassed estimates in two of the trailing four quarters and missed the mark in the other two, the average surprise being 3.42%.

Stay on top of upcoming earnings announcements with the Zacks Earnings Calendar.

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McKesson Corporation (MCK) : Free Stock Analysis Report

Henry Schein, Inc. (HSIC) : Free Stock Analysis Report

DexCom, Inc. (DXCM) : Free Stock Analysis Report

Bio-Rad Laboratories, Inc. (BIO) : Free Stock Analysis Report

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