Dexcom stock slumped Wednesday on a report Apple is working to add a blood glucose monitor to its popular Apple Watch.
The move would rival Dexcom's line of body-worn continuous glucose monitors, or CGMs. These devices help people with diabetes keep tabs on their blood sugar in real time. The device requires a small needle that sits just under the skin.
Apple's approach, on the other hand, would use a noninvasive approach, according to Bloomberg. The company is reportedly testing a system that uses lasers to look below the skin for substances that can be absorbed by glucose. An algorithm then determines the blood glucose level.
On today's stock market, Dexcom stock slipped 2.1% to close at 111.65. Apple stock rose a fraction and ended the regular session at 148.91.
Dexcom Stock: Growing Market
Apple's development of a glucose monitor remains in its early stages. But it's a lucrative market. Last year, Dexcom had more than $2.9 billion in sales. This year, the company expects $3.35 billion to $3.49 billion in sales.
The market also is growing. Data from the Centers for Disease Control and Prevention show more than 11% of the U.S. population has diabetes. Almost four in 10 adults in the U.S. have prediabetes, a state in which blood sugars are higher than normal, but not high enough for a type 2 diabetes diagnosis.
Dexcom stock is highly rated following its success in diabetes treatment. The medical stock has a bullish Relative Strength Rating of 92 out of a best-possible 99. This puts shares in the top 8% of all stocks in terms of 12-month performance, according to IBD Digital.
Shares are currently forming a cup-with-handle base and a buy point at 121.21, MarketSmith.com shows. The move Wednesday sent Dexcom stock briefly below the lower boundary of its base.
Representatives of Dexcom and Apple didn't immediately return requests for comment from Investor's Business Daily.
Follow Allison Gatlin on Twitter at @IBD_AGatlin.
