MeritValue

DEXCOM INC

DXCMdata completeness 88%17 fiscal years on file
The thesis, from the filings

DEXCOM INC earns about 34% on invested capital, far above its ~9% cost of capital, and has bought back 5% of its shares over 5 years — the marks of a durable business run for its owners. The estimate methods put fair value between $13.84 and $95.03 a share.Whether it’s worth owning at today’s price is the last question — and yours to answer, below.

i. The business — what you’d actually own
FigureFY 2021FY 2022FY 2023FY 2024FY 2025
Revenue$2.45B1$2.91B2$3.62B3$4.03B3$4.66B3
Net income$216.9M4$341.2M5$541.5M6$576.2M6$836.3M6
Operating cash flow$442.5M7$669.5M8$748.5M9$989.5M9$1.44B9
Capital expenditure$389.2M10$364.8M11$236.6M12$358.8M12$363.5M12
Free cash flow (derived)$53.3M7$304.7M8$511.9M9$630.7M9$1.08B9
Total debt—————
Cash & equivalents$1.05B13$642.3M14$566.3M15$606.1M15$917.7M15
Diluted shares428.8M427.5M425.5M412.7M405.5M

Superscripts are receipts. Each links to the SEC filing the number came from (full list at the bottom).

ii. Your slice — ownership made literal
If you owned
shares
Net assets behind them
$67.72
your share of equity
Profit it earned you last year
$20.62
Free cash flow it threw off
$26.56
Debt you’d be carrying
—

10 shares is a claim on $67.72 of net worth that earned you $20.62 and generated $26.56 of cash last year.

iii. Is this a good business?
Moat signal · return on invested capital
34% avg · 5y
FY21 24%FY22 24%FY23 37%FY24 39%FY25 46%

It earned about 34% on invested capital, year after year, against a ~9% cost of capital — the footprint of real pricing power. Competition usually drags returns like this back down; here it hasn't.

seeing a moat in the numbers →
Management signal · capital allocation
−5% shares · 5y

Share count is down 5% over 5 years — management has been buying back stock, quietly handing owners a bigger slice.

reading capital allocation →

Signals, not verdicts — read from the filings above. Numbers don’t prove a moat; they show its footprint. You decide.

iv. What it’s worth — engine v0.1.0

The 3 estimate methods that apply put fair value between $13.84 and $95.03 a share. They rest on different assumptions, so where they diverge is the story; the Graham Number is a stricter floor, not a target.

DCF · Growth Exit 10Y
$95.03
assumptions (10)
  • riskFreeRate4.7%
  • equityRiskPremium5.0%
  • beta100.0%
  • equityWeight85.0%
  • costOfDebtSpread1.5%
  • taxRate21.0%
  • terminalGrowth2.5%
  • projectionYears10
  • fcfGrowth20.0%
  • fcfBase$630.7M
DCF · Growth Exit 5Y
$52.97
assumptions (10)
  • riskFreeRate4.7%
  • equityRiskPremium5.0%
  • beta100.0%
  • equityWeight85.0%
  • costOfDebtSpread1.5%
  • taxRate21.0%
  • terminalGrowth2.5%
  • projectionYears5
  • fcfGrowth20.0%
  • fcfBase$630.7M
Earnings Power Value
$13.84
assumptions (8)
  • riskFreeRate4.7%
  • equityRiskPremium5.0%
  • beta100.0%
  • equityWeight85.0%
  • costOfDebtSpread1.5%
  • taxRate21.0%
  • normalizedEarnings$541.5M
  • growthAssumed0.0%
Graham Number
$17.85
assumptions (1)
  • grahamMultiplier2250.0%

Different models answer different questions — which to trust when →

v. The price question — last, on purpose
Is today’s price fair?
See live price ↗
Type a price. The ledger answers.
Or set your own belief
FCF growth, next 5 years20.0%
Discount rate (WACC)8.93%
Terminal growth2.5%
At your growth, a share is worth $52.97
The three cases
Bear0.0%$24.49
Base20.0%$52.97
Bull20.0%$52.97

Bear/base/bull growth = 0% / filed history / history + 5pp. Type a price to see the return each case implies.

Default growth 20.0%= this company’s own filed history (median-to-median FCF CAGR, clamped 0–20%). Your adjustments are recorded anonymously. They become the “what do owners actually believe” dataset.

Sources — the receipts
  1. 10-K · period ending 2021-12-31 · accession 0001093557-24-000021 (RevenueFromContractWithCustomerExcludingAssessedTax)
  2. 10-K · period ending 2022-12-31 · accession 0001093557-25-000036 (RevenueFromContractWithCustomerExcludingAssessedTax)
  3. 10-K · period ending 2023-12-31 · accession 0001093557-26-000027 (RevenueFromContractWithCustomerExcludingAssessedTax)
  4. 10-K · period ending 2021-12-31 · accession 0001093557-24-000021 (NetIncomeLoss)
  5. 10-K · period ending 2022-12-31 · accession 0001093557-25-000036 (NetIncomeLoss)
  6. 10-K · period ending 2023-12-31 · accession 0001093557-26-000027 (NetIncomeLoss)
  7. 10-K · period ending 2021-12-31 · accession 0001093557-24-000021 (NetCashProvidedByUsedInOperatingActivities)
  8. 10-K · period ending 2022-12-31 · accession 0001093557-25-000036 (NetCashProvidedByUsedInOperatingActivities)
  9. 10-K · period ending 2023-12-31 · accession 0001093557-26-000027 (NetCashProvidedByUsedInOperatingActivities)
  10. 10-K · period ending 2021-12-31 · accession 0001093557-24-000021 (PaymentsToAcquirePropertyPlantAndEquipment)
  11. 10-K · period ending 2022-12-31 · accession 0001093557-25-000036 (PaymentsToAcquirePropertyPlantAndEquipment)
  12. 10-K · period ending 2023-12-31 · accession 0001093557-26-000027 (PaymentsToAcquirePropertyPlantAndEquipment)
  13. 10-K · period ending 2021-12-31 · accession 0001093557-24-000021 (CashAndCashEquivalentsAtCarryingValue)
  14. 10-K · period ending 2022-12-31 · accession 0001093557-25-000036 (CashAndCashEquivalentsAtCarryingValue)
  15. 10-K · period ending 2023-12-31 · accession 0001093557-26-000027 (CashAndCashEquivalentsAtCarryingValue)