Dexcom Remains Well Positioned for Further Growth in 2023; No Change to Our FVE

No-moat Dexcom delivered another quarter of solid results, and full-year performance hit our 2022 revenue estimate and gross margin on the nose. However, the absence of spending on collaborative research and development pushed earnings above our expectations, though not enough to shift our fair value estimate. We anticipate the U.S. regulatory approval of the next-generation G7 sensor should support 2023 top-line growth of 20%, which is at the top end of management’s outlook of 15% to 20%. The strength of international sales growth in 2022, buoyed by the earlier launch of G7 in European markets, gives us confidence that the upper end of 2023 guidance can be achieved.