DXCM Stock Up Nearly 35% YTD: Will the Uptrend Continue in the Rest of 2026?

YTD Performance of DXCM vs Industry

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What Is Fueling DXCM’s Growth?

Non-Insulin Type 2 Diabetes Could Expand the Addressable Market: DexCom’s CONNECT trial could become an important growth catalyst by strengthening the case for CGM among non-insulin Type 2 patients. The study produced a 1.6% A1c improvement over six months, while commercial coverage has expanded across the four largest U.S. PBMs, reaching more than 7 million eligible patients. Broader reimbursement could significantly accelerate adoption beyond DexCom’s traditional customer base.

G7 15 Day Is Strengthening Product Adoption: The G7 15 Day rollout is creating a meaningful product-cycle opportunity. DexCom expects nearly 50% of its U.S. customer base to transition to the system by year-end, supported by an improved algorithm, longer wear time and stronger customer satisfaction. G7 15 Day also received Health Canada clearance, opening another avenue for international expansion. The product transition contributed to a roughly 400-basis-point improvement in second-quarter gross margin.

International Expansion Provides Another Growth Lever: International markets are growing increasingly important to DexCom’s growth trajectory. International revenues increased 19% in the second quarter, with organic growth of 16%. France and Canada benefited from expanding reimbursement access. DexCom is also rolling out Flex, its 15-day sensor for select Type 2 basal and non-insulin markets. Continued reimbursement wins could help the company replicate the share gains achieved in recently opened markets.

DexCom Is Building a Broader Digital Diabetes Platform: DexCom is expanding beyond sensor hardware through software and digital-health capabilities. The redesigned Stelo app adds AI-driven insights and enhanced food logging, while Smart Basal has reduced the time needed to reach an optimal basal insulin dose to about three weeks in pilot practices. The company also acquired Nutrisense, a CGM-data nutrition platform, creating additional potential for personalized metabolic-health services.

A Glance at DXCM’s Estimates

The Zacks Consensus Estimate for DXCM’s 2026 and 2027 earnings per share (EPS) implies year-over-year growth of 26.8% and 16.6%, respectively, to $2.64 and $3.08. In the past 60 days, the consensus mark for the company's 2026 EPS has improved 2.7%.

Revenues for 2026 are projected to grow 12.1% to $5.23 billion and another 11.6% to $5.83 billion in 2027.

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Competition Remains a Major Variable

The CGM market remains highly competitive, with Abbott ABT, MiniMed MMED and Senseonics SENS pursuing distinct strategies. Abbott remains DexCom’s most formidable direct rival, with Diabetes Care CGM sales exceeding $2 billion in the second quarter, reflecting growth of 9.5%.

Abbott also received CE Mark clearance for Libre Duo, its glucose-ketone monitoring sensor. MiniMed is strengthening its ecosystem, with CGM revenues growing at a low-double-digit rate in fiscal 2026 and its attachment rate reaching 68% in the fiscal fourth quarter. Senseonics is also growing much faster from a smaller base, with second-quarter revenues increasing about 120% and U.S. revenue growing more than 150%, supported by Eversense 365 and its Eon Care network.

Compared with Abbott, MiniMed, and Senseonics, DexCom currently benefits from greater scale, 13% reported revenue growth, and strong international momentum. However, Abbott’s scale, MiniMed’s integrated pump-CGM ecosystem, and Senseonics’ differentiated long-duration sensor could heighten competitive pressures.

Risks and Challenges

The second half of 2026 will not be without challenges. DexCom remains dependent on reimbursement expansion, particularly for non-insulin Type 2 diabetes, and regulatory or payer delays could slow the addressable-market opportunity. Competition from Abbott could intensify as Libre Duo expands, while MiniMed’s new products could strengthen its integrated pump-CGM proposition. Senseonics also presents a differentiated alternative in long-duration CGM. Execution around the G7 15 Day conversion, international launches and new digital-health initiatives will be critical.

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Conclusion

DexCom’s 2026 rally appears to be supported by improving fundamentals rather than short-term momentum alone. Expanding reimbursement, G7 15 Day adoption, international growth and digital-health initiatives provide multiple avenues for sustained expansion. However, competitive intensity and reimbursement execution remain important variables. With a Zacks Rank #3 (Hold), the stock appears better suited to investors willing to balance its strong growth potential against valuation and execution risks. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

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This article originally published on Zacks Investment Research (zacks.com).

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