Dexcom Inc (NASDAQ: DXCM)

Sector: Healthcare Industry: Medical Devices CIK: 0001093557
Market Cap 27.52 Bn
P/B 10.02
P/E 32.91
P/S 5.90
ROIC (Qtr) 15.34
Div Yield % 0.00
Rev 1y % (Qtr) 13.12
Total Debt (Qtr) 1.34 Bn
Debt/Equity (Qtr) 0.49
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About

Investment thesis

Bull case

  • Strong operating cash flow of 1.44B provides robust 1.08x coverage of total debt 1.34B, indicating excellent debt servicing capability and financial flexibility.
  • Healthy cash reserves of 917.70M provide 42.49x coverage of short-term debt 21.60M, demonstrating strong liquidity position and minimal refinancing risk.
  • Operating cash flow of 1.44B provides exceptional 78.73x coverage of interest expenses 18.30M, showing strong debt service capability.
  • Strong tangible asset base of 6.24B provides 4.67x coverage of total debt 1.34B, indicating robust asset backing and low credit risk.
  • Robust free cash flow of 1.08B exceeds capital expenditure of 363.50M by 2.96x, indicating strong organic growth funding capability.

Bear case

  • Investment activities of 536M provide weak support for R&D spending of 599.10M, which is 0.89x, suggesting potentially insufficient investment in innovation relative to other capital deployment.
  • Free cash flow of 1.08B represents just -0.89x of debt issuance (1.21B), suggesting concerning reliance on leverage rather than internal cash generation for growth.
  • Operating cash flow of 1.44B is outpaced by equity issuance of (471.90M) (-3.05 ratio), indicating concerning reliance on equity markets for funding operations.
  • Fixed assets of 1.64B showing 6.50x ratio to depreciation of 251.80M indicates aging infrastructure requiring significant near-term capital investment.
  • Other current assets of 189.40M provide weak coverage of payables of 1.94B, which is 0.10x, suggesting potential working capital stress in near term.

Peer comparison

Companies in the Medical Devices
S.No. Ticker Company Market Cap P/E P/S Total Debt (Qtr)
1 ABT Abbott Laboratories 173.80 Bn 32.73 5.47 12.94 Bn
2 SYK Stryker Corp 141.15 Bn 43.48 5.62 15.86 Bn
3 MDT Medtronic plc 123.47 Bn 25.92 3.55 29.10 Bn
4 BSX Boston Scientific Corp 112.80 Bn 38.92 5.62 11.44 Bn
5 EW Edwards Lifesciences Corp 45.66 Bn 33.38 7.76 0.70 Bn
6 DXCM Dexcom Inc 27.52 Bn 32.91 5.90 1.34 Bn
7 STE STERIS plc 24.13 Bn 34.08 4.14 2.05 Bn
8 PODD Insulet Corp 17.33 Bn 70.38 6.87 1.01 Bn

Industry comparisons

Current Valuation Value Ind Avg Percentile
EV to Assets EV to Assets 4.45 2.13
EV to Cash from Ops. EV/CFO 19.58 2.75
EV to Debt EV to Debt 21.12 17.25
EV to EBIT EV/EBIT 25.49 2.89
EV to EBITDA EV/EBITDA 24.24 4.53
EV to Free Cash Flow [EV/FCF] EV/FCF 26.19 29.36
EV to Market Cap EV to Market Cap 1.02 25.09
EV to Revenue EV/Rev 6.05 32.80
Price to Book Value [P/B] P/B 10.02 4.73
Price to Earnings [P/E] P/E 32.91 -2.04
Dividend Metrics Value Ind Avg Percentile
Dividend Coverage Ratio Dividend Coverage Ratio 0.00 40.22
Dividend Payout Ratio % Div Payout % (Qtr) 0.00 1.59
Dividend per Basic Share Div per Share (Qtr) 0.00 0.10
FCF Dividend Payout Ratio % FCF Div Payout % (Qtr) 0.00 -0.37
Interest Coverage Int. cover (Qtr) 60.48 196.93
Growth Metrics Value Ind Avg Percentile
Capex Growth (1y) % Capex 1y % (Qtr) -1.31 -152.08
Cash and Equivalents Growth (1y) % Cash & Equiv 1y % (Qtr) 51.41 8,476.58
Dividend Growth (1y) % Dividend Growth (1y) % 0.00 -0.44
EBIAT Growth (1y) % EBIAT 1y % (Qtr) 43.73 -792.16
EBITDA Growth (1y) % EBITDA 1y % (Qtr) 42.30 3.79
EBIT Growth (1y) % EBIT 1y % (Qtr) 52.02 -301.80
EBT Growth (1y) % EBT 1y % (Qtr) 53.51 -121.44
EPS Growth (1y) % EPS 1y % (Qtr) 46.58 -87.51
FCF Growth (1y) % FCF 1y % (Qtr) 70.79 10.43
Gross Profit Growth (1y) % Gross Profit 1y % (Qtr) 14.92 38.21
Liquidity Ratios Value Ind Avg Percentile
Asset Utilization Ratio Asset Util Ratio (Qtr) 0.74 0.55
Cash Payout Ratio Cash Payout (Qtr) 0.00 0.02
Cash Ratio Cash Ratio (Qtr) 0.43 1.80
Current Ratio Curr Ratio (Qtr) 1.88 4.18
Debt to Equity Ratio Debt/Equity (Qtr) 0.49 1.20
Interest Cover Ratio Int Coverage (Qtr) 60.48 196.93
Times Interest Earned Times Interest Earned (Qtr) 60.48 196.93
Profitability Value Ind Avg Percentile
EBITDA Margin % EBITDA Margin % (Qtr) 29.10 -2,396.63
EBIT Margin % EBIT Margin % (Qtr) 23.74 -2,478.60
EBT Margin % EBT Margin % (Qtr) 23.35 -2,690.42
Gross Margin % Gross Margin % (Qtr) 60.10 30.80
Net Profit Margin % Net Margin % (Qtr) 17.90 -2,821.53