Dexcom stock is the IBD Stock Of The Day after the Food and Drug Administration cleared its next-generation continuous glucose monitor for patients with diabetes.
With the FDA's blessing, Dexcom now plans to launch its next-generation continuous glucose monitor in the U.S. "in the coming months," Chief Executive Kevin Sayer said in a written statement. The body-worn device, dubbed G7, helps patients keep tabs on their blood sugar in real time. The G7 launched in five European countries this fall.
Last month, Sayer told Investor's Business Daily the G7 would build on the previous G6 device. He said the next-generation device is 60% smaller, more accurate, has more convenient onboarding options and a better app experience for patients. It's also compatible with other wearable devices like the Apple Watch, the company said in a news release.
"Everything anybody loves about G6 gets better with G7," Sayer told IBD.
In midday trades on the stock market today, Dexcom stock popped 4.4% to 123.11. Shares briefly topped a buy point at 123.46 out of a flat base, according to MarketSmith.com. But investors could also use last week's high of 119.98 as an early entry.
Dexcom Stock: Integrating With Other Devices
Specifically, the FDA cleared Dexcom's newest device for patients age 2 and older with both types of diabetes. Type 1 diabetes is a genetic condition in which patients' bodies don't make enough, or any, of their own insulin. Type 2 diabetes is a progressive condition.
Dexcom is now working with insulin pump makers to integrate G7 with their products. Doing so will allow for more automated insulin delivery when blood sugar spikes. The company is going up against Medtronic and Abbott Laboratories in this space.
Bullishly for Dexcom stock, the company's devices have insurance reimbursement by more than 97% of private insurers, as well as by Medicare nationwide and Medicaid in 45 states. This allows for broader access to the device.
Roughly a third of patients with commercial insurance pay nothing out of pocket. The majority pay less than $40 per month for the CGM.
Dexcom stock has high ratings from IBD Digital. Shares have a strong Composite Rating of 96 and a Relative Strength Rating of 95. This puts shares in the top 4% of all stocks in terms of fundamental and technical measures, and in the leading 5% of all stocks when it comes to 12-month performance.
Follow Allison Gatlin on Twitter at @IBD_AGatlin.
