DexCom, Inc. (DXCM) — Fundamental Analysis & Key Financial Ratios

Kaplio's reading: DexCom, Inc.

Updated on October 31, 2026 · accounts published on October 29, 2026

A fast-growing business with record margins and a solid balance sheet

DexCom's operating margin reached 24 % over the last 12 months, far above its 3.6 % average for fiscal 2014-2025, with EPS up 47 %.

• Is DexCom expensive or cheap? DexCom trades at a P/E of 32.3, 5 % above its sector median of 30.7 and far below its 7-year average of 115.0.
• How is the business doing? DexCom's operating margin is 24 % over the last 12 months, against a 3.6 % average for fiscal 2014-2025.
• How strong is the balance sheet? DexCom held net cash of $1.51 per share at the end of fiscal 2025, and its Altman Z of 6.4 is in the safe zone.
• What to expect from the next earnings? Analysts expect EPS of $0.73 in the results due February 11, 2027, and 41 of 52 rate DexCom a buy.
• Does DexCom invest enough in R&D and turn profit into cash? Free cash flow was 129 % of net income in fiscal 2025, but R&D at 12.9 % of revenue falls short of the 15 % health bar.

Is DexCom expensive or cheap?

Over the last 12 months DexCom's P/E is 32.3. That is a 5 % premium to the 30.7 median of 246 health care companies, so the market prices it close to its peers. Its own history tells a different story: the 7-year average P/E is 115.0, and today's multiple sits well below it because profits have caught up with the share price. The free cash flow yield of 5.5 % is higher than the 4.3 % earnings yield, which means cash generation is running ahead of reported profit. The stock is up 21 % over 12 months and still 11 % below its 52-week high of $92.34.

How is the business doing?

Over the last 12 months revenue grew 16 % year over year and EPS rose 47 %, so profit is growing about three times as fast as sales. The margins show that leverage. Operating margin in fiscal 2025 was 19.6 %, the highest in 12 years, and the trailing figure of 24 % is already above it. ROIC of 24 % is 18.4 points above the 5.6 % median of 346 sector peers. The weak point is consistency: ROIC cleared 10 % in only 2 of the last 10 fiscal years and fell as low as −21.3 % in 2016, so returns this high are recent and not yet proven.

How strong is the balance sheet?

At the end of fiscal 2025, cash of $5.12 per share covered debt of $3.61 per share, leaving net cash of $1.51, or 1.8 % of the current price. Over the last 12 months debt to equity is 0.55 and the current ratio is 1.74, comfortable levels for a company with expanding margins. An Altman Z score of 6.4 puts DexCom well inside the safe zone, and a Piotroski score of 7 out of 9 points to improving profitability, leverage and efficiency. The net cash cushion is small next to the share price, but the balance sheet shows no visible strain.

What to expect from the next earnings?

On October 29, 2026 DexCom reported EPS of $0.73 against $0.68 expected, an 8 % beat. It has beaten estimates in 6 of the last 8 quarters. Consensus for the next quarter is $0.73, flat with the quarter just reported. Over the last 30 days the 2026 EPS estimate held at $2.67 across 16 analysts and the revenue estimate barely moved, so the latest results did not lead to revisions. Coverage is broad and positive: 41 of 52 analysts recommend buying, 8 holding and 2 selling. The February 11, 2027 report will show whether the run of beats continues.

Does DexCom invest enough in R&D and turn profit into cash?

In health care the R&D pipeline is the hidden asset, and expiring patents are revenue that disappears. That is why the sector is judged on innovation spending and cash flow, not just near-term earnings. DexCom converts profit into cash well: free cash flow equalled 129 % of net income in fiscal 2025, above the 90 % healthy threshold, and EPS compounded at 10.4 % a year over fiscal 2020-2025, beating the 8 % bar. R&D spending of 12.9 % of revenue in fiscal 2025 is below the 15 % mark. The 60 % gross margin trails the 70 % benchmark, which is set for branded drug makers.

How this was prepared: the data comes from companies' official filings, collected by a professional provider, and from Kaplio's analysis engine (trailing-12-month ratios, 10 years of history and sector medians computed across US-listed companies). The text is written from that data alone, every figure is checked against it before publication, and it is reviewed when the company reports results. This is not investment advice.