Stock Analysis on Net

DexCom Inc. (NASDAQ:DXCM)

$22.49

This company has been moved to the archive! The financial data has not been updated since October 26, 2023.

Analysis of Investments

Microsoft Excel

Adjustment to Net Income (Loss): Mark to Market Available-for-sale Securities

DexCom Inc., adjustment to net income (loss)

US$ in thousands

Microsoft Excel
12 months ended: Dec 31, 2022 Dec 31, 2021 Dec 31, 2020 Dec 31, 2019 Dec 31, 2018
Net income (loss) (as reported)
Add: Unrealized gain (loss) on marketable debt securities
Net income (loss) (adjusted)

Based on: 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31).


Reported net income (loss)
The reported net income exhibited significant volatility over the observed five-year period. In 2018, the company recorded a substantial net loss of approximately $127.1 million. This was followed by a notable turnaround in 2019, with a net income of about $101.1 million. The upward trend continued strongly in 2020, when net income increased sharply to nearly $493.6 million. However, in 2021, the net income decreased markedly to approximately $154.7 million. The year 2022 showed a partial recovery, with net income rising to around $341.2 million, reflecting a fluctuating but overall positive performance after the initial losses.
Adjusted net income (loss)
The adjusted net income figures closely mirror the reported net income values, indicating a consistent adjustment methodology with minimal deviation. Similar to reported net income, adjusted net income started with a loss of approximately $127.0 million in 2018, followed by a shift to positive earnings of about $101.5 million in 2019. The peak adjusted net income was recorded in 2020 at approximately $493.4 million. Subsequent years showed a decline to $153.0 million in 2021, followed by an increase to $338.9 million in 2022. The minor differences between reported and adjusted figures suggest that the adjustments made were relatively small and did not significantly alter the overall profitability trend.

Adjusted Profitability Ratios: Mark to Market Available-for-sale Securities (Summary)

DexCom Inc., adjusted profitability ratios

Microsoft Excel
Dec 31, 2022 Dec 31, 2021 Dec 31, 2020 Dec 31, 2019 Dec 31, 2018
Net Profit Margin
Reported net profit margin
Adjusted net profit margin
Return on Equity (ROE)
Reported ROE
Adjusted ROE
Return on Assets (ROA)
Reported ROA
Adjusted ROA

Based on: 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31).


The analyzed data reveals significant fluctuations in profitability and returns over the five-year span from 2018 to 2022.

Net Profit Margin
The reported net profit margin shows a strong improvement from a negative -12.32% in 2018 to a peak of 25.62% in 2020. However, this margin sharply declined to 6.32% in 2021 before recovering moderately to 11.73% in 2022. The adjusted net profit margin closely mirrors these movements, indicating consistent adjustments that do not materially affect the trend.
Return on Equity (ROE)
ROE follows a similar pattern, starting from a negative -19.16% in 2018 and substantially increasing to 27.02% in 2020. This is followed by a pronounced reduction to 6.87% in 2021 and a recovery to 16.01% in 2022. The adjusted ROE figures remain almost identical to the reported values, confirming the robustness of these returns after adjustments.
Return on Assets (ROA)
The reported ROA also demonstrates improvement from -6.63% in 2018 to 11.5% in 2020, before dropping to 3.18% in 2021 and rising again to 6.33% in 2022. Adjusted ROA values closely track the reported numbers, differing only marginally, indicating minimal impacts from investment adjustments.

Overall, the company experienced a turnaround from negative profitability and returns in 2018 to substantial positive performance by 2020 across all metrics. However, 2021 brought a significant decline in profitability and return measures, followed by a partial rebound in 2022. The close alignment between reported and adjusted values suggests stable financial reporting practices without major discrepancies from adjustments.


DexCom Inc., Profitability Ratios: Reported vs. Adjusted


Adjusted Net Profit Margin

Microsoft Excel
Dec 31, 2022 Dec 31, 2021 Dec 31, 2020 Dec 31, 2019 Dec 31, 2018
As Reported
Selected Financial Data (US$ in thousands)
Net income (loss)
Revenue
Profitability Ratio
Net profit margin1
Adjusted: Mark to Market Available-for-sale Securities
Selected Financial Data (US$ in thousands)
Adjusted net income (loss)
Revenue
Profitability Ratio
Adjusted net profit margin2

Based on: 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31).

2022 Calculations

1 Net profit margin = 100 × Net income (loss) ÷ Revenue
= 100 × ÷ =

2 Adjusted net profit margin = 100 × Adjusted net income (loss) ÷ Revenue
= 100 × ÷ =


The financial data displays the annual net income and net profit margins for the company over a five-year period from 2018 to 2022. The analysis of both reported and adjusted figures reveals several significant trends and fluctuations.

Net Income (Loss)
In 2018, the company experienced a substantial net loss, with reported net income at -$127.1 million and adjusted net income closely matching this figure. The following year, 2019, marked a considerable turnaround as net income shifted to a positive territory of approximately $101.1 million, showing a strong recovery. This positive momentum intensified sharply in 2020, peaking at about $493.6 million in reported net income, reflecting significant growth or operational improvements during that period.
However, the net income decreased markedly in 2021 to approximately $154.7 million, indicating a slowdown or reversal of the previous year's gains. The year 2022 saw a recovery again with net income rising to $341.2 million, suggesting partial restoration of profitability though still below the peak reached in 2020.
The adjusted net income closely follows the reported figures throughout the periods, with only minor numerical differences, indicating consistent adjustments and reliable alignment between reported and adjusted performance.
Net Profit Margin
The net profit margin follows a similar pattern to net income. In 2018, the margin was negative at around -12.3%, reflecting the net loss status. A shift to positive margins occurred in 2019 with margins near 6.8%, indicating a successful turnaround in profitability.
In 2020, the profit margin surged dramatically to approximately 25.6%, representing a highly profitable year in relative terms. This was followed by a steep decline in 2021 to just above 6.3%, showing a significant reduction in profitability efficiency despite still positive earnings. The margin improved again in 2022 to about 11.7%, indicating a moderate return to higher profitability levels.
The adjusted net profit margin closely mirrors the reported margin figures, reinforcing the consistency between the reported financial data and the investment-adjusted figures.

Overall, the data reveals an initial recovery from a substantial loss in 2018 to strong profitability growth peaking in 2020, followed by a pronounced contraction in 2021 and a partial recovery in 2022. The close alignment between reported and adjusted financial data suggests transparency and consistency in reporting. The fluctuations in net income and margin highlight periods of significant operational change or market conditions impacting financial performance.


Adjusted Return on Equity (ROE)

Microsoft Excel
Dec 31, 2022 Dec 31, 2021 Dec 31, 2020 Dec 31, 2019 Dec 31, 2018
As Reported
Selected Financial Data (US$ in thousands)
Net income (loss)
Stockholders’ equity
Profitability Ratio
ROE1
Adjusted: Mark to Market Available-for-sale Securities
Selected Financial Data (US$ in thousands)
Adjusted net income (loss)
Stockholders’ equity
Profitability Ratio
Adjusted ROE2

Based on: 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31).

2022 Calculations

1 ROE = 100 × Net income (loss) ÷ Stockholders’ equity
= 100 × ÷ =

2 Adjusted ROE = 100 × Adjusted net income (loss) ÷ Stockholders’ equity
= 100 × ÷ =


Reported Net Income (Loss)
The reported net income exhibited a significant turnaround from a loss of $127.1 million in 2018 to a profit of $101.1 million in 2019. This positive trajectory continued strongly into 2020, reaching a peak of $493.6 million. However, the following year saw a notable decline to $154.7 million, before increasing again to $341.2 million in 2022, indicating some volatility but overall growth compared to the initial periods.
Adjusted Net Income (Loss)
The adjusted net income closely mirrored the reported figures throughout the timeframe, beginning with a loss of $127.0 million in 2018, then shifting to profits, peaking at approximately $493.4 million in 2020. Subsequent years showed a decrease to $153.0 million in 2021, followed by a recovery to $338.9 million in 2022. The minimal variation between reported and adjusted figures suggests limited impact from non-recurring or adjustment items on net income.
Reported Return on Equity (ROE)
The reported ROE followed a pattern consistent with net income trends. Initially negative at -19.16% in 2018, ROE moved into positive territory in 2019 at 11.45%, then surged to a high of 27.02% in 2020. This was followed by a decline to 6.87% in 2021 and a subsequent improvement to 16.01% in 2022. The fluctuations indicate periods of strong equity profitability interspersed with times of reduced efficiency in generating returns for shareholders.
Adjusted Return on Equity (ROE)
The adjusted ROE mirrors the reported ROE values closely, starting negative at -19.15% in 2018, increasing to 11.5% in 2019, peaking at 27.01% in 2020, then dropping to 6.8% in 2021 before rising back to 15.9% in 2022. The alignment with reported ROE reflects consistency in fundamental equity performance after adjustments, with negligible difference due to one-time or non-recurring items.

Adjusted Return on Assets (ROA)

Microsoft Excel
Dec 31, 2022 Dec 31, 2021 Dec 31, 2020 Dec 31, 2019 Dec 31, 2018
As Reported
Selected Financial Data (US$ in thousands)
Net income (loss)
Total assets
Profitability Ratio
ROA1
Adjusted: Mark to Market Available-for-sale Securities
Selected Financial Data (US$ in thousands)
Adjusted net income (loss)
Total assets
Profitability Ratio
Adjusted ROA2

Based on: 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31).

2022 Calculations

1 ROA = 100 × Net income (loss) ÷ Total assets
= 100 × ÷ =

2 Adjusted ROA = 100 × Adjusted net income (loss) ÷ Total assets
= 100 × ÷ =


Net Income Trends
The reported net income displayed a significant turnaround over the analyzed period. Initially, there was a substantial loss of $127.1 million in 2018, which reversed to a positive income of $101.1 million in 2019. This upward trajectory continued, peaking at $493.6 million in 2020 before decreasing to $154.7 million in 2021 and subsequently increasing again to $341.2 million in 2022. The adjusted net income follows a very similar pattern, indicating that the adjustments made had minimal impact on net income figures.
Return on Assets (ROA) Trends
The reported ROA similarly reflects the changes seen in net income, beginning with a negative value of -6.63% in 2018 and then improving sharply to 4.22% in 2019 and peaking at 11.5% in 2020. Following this peak, ROA declined to 3.18% in 2021 before rising again to 6.33% in 2022. The adjusted ROA closely mirrors the reported figures, confirming consistency between the reported and adjusted data sets.
Overall Insights
There is a clear pattern of recovery and growth from 2018 through 2020, followed by variability in 2021 and 2022. The peak performance year was 2020 in terms of both income and ROA, after which some volatility occurred, yet the company maintained profitability and positive returns. The minimal differences between reported and adjusted figures suggest that the adjustments made were not material to the overall financial outcomes. This pattern indicates increased operational efficiency and asset utilization after 2018, despite some fluctuations in the latter years.