DexCom, Inc. (DXCM): A Bull Case Theory 

We came across a bullish thesis on DexCom, Inc. on Flyover Stocks Substack by Todd Wenning. In this article, we will summarize the bulls’ thesis on DXCM. DexCom, Inc.’s share was trading at $76.22 as of September 12th. DXCM’s trailing and forward P/E were 53.68 and 29.41 respectively according to Yahoo Finance.

DexCom (DXCM) is a leading provider of continuous glucose monitoring (CGM) devices, serving millions of people managing Type 1 and Type 2 diabetes, as well as individuals tracking glucose for wellness purposes. Founded in 1999, DexCom pioneered accurate, real-time glucose monitoring, shifting the standard of care away from periodic finger pricks. Its competitive edge lies in product performance and integration across platforms, with devices like G6, G7, and Stelo offering seamless connectivity, whereas competitors such as Abbott’s FreeStyle Libre and Medtronic’s Guardian are largely confined to their own ecosystems and often compete on price rather than innovation.

DexCom’s business model is highly lucrative, with hardware representing only 5% of revenue and disposable sensors accounting for 95%, supported by industry-leading retention rates. Despite this, the stock has underperformed over the past five years, reflecting a negative 20% total return, amid growing competition and market pressures. Abbott’s low-cost, widely reimbursed FreeStyle Libre platform and Medtronic’s heavy investment in next-generation CGM pose challenges, while the rapid adoption of GLP-1 drugs for diabetes and obesity could reduce demand among Type 2 patients. Nonetheless, significant growth opportunities remain.

CGM penetration is still low in key populations, including Type 2 diabetics and prediabetics, numbering over 100 million in the U.S., and expanding insurance coverage enhances adoption potential. International markets, such as Japan and Saudi Arabia, remain underpenetrated, offering additional upside, while entry into over the counter and wellness markets with Stelo may create new revenue streams. DexCom’s combination of a high-margin, sticky business model, innovation leadership, and underpenetrated markets provides a compelling risk/reward profile, though investors must consider evolving treatment trends and competitive dynamics in assessing its long-term growth potential.

Previously we covered a bullish thesis on DexCom, Inc. (DXCM) by Na’s Substack in May 2025, which highlighted product innovation, Type 2 diabetes expansion, and user growth despite margin pressures. The stock has depreciated about 6% since then due to competition and cost headwinds. The thesis still stands on reimbursement gains and platform integration. Todd Wenning shares a similar view but emphasizes GLP-1 risks.

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Disclosure: None.