DexCom Inc. (NASDAQ:DXCM)

Total Asset Turnover Ratios

The reported total asset turnover initially increased from 0.54 in 2018 to 0.62 in 2019, followed by a decline to 0.45 in 2020. Subsequently, it showed gradual improvement, reaching 0.54 by 2022. The adjusted total asset turnover mirrors this trend, starting at 0.52 in 2018, peaking at 0.61 in 2019, dipping to 0.47 in 2020, and steadily increasing to 0.58 in 2022. This pattern suggests fluctuating efficiency in asset utilization, with a recovery observed in the most recent years.

Current Ratios

Both reported and adjusted current ratios display a declining trend over the five-year period. Beginning at a notably high level of approximately 7.6 to 8.0 in 2018, the ratios gradually decrease to slightly above 5 in the years 2019 through 2021, and then sharply drop to around 2.0 in 2022. This trend indicates a significant reduction in liquidity, implying a move towards a leaner current asset base relative to current liabilities in recent periods.

Debt to Equity Ratios

The reported debt to equity ratio decreases consistently from 1.53 in 2018 to a low of 0.78 in 2021, before increasing again to 0.95 in 2022. The adjusted debt to equity ratio follows a similar but slightly higher trajectory, starting at 1.58 in 2018, decreasing to 0.91 in 2021, and rising to 1.17 in 2022. This indicates a general trend of reduced reliance on debt financing relative to equity prior to a modest increase in the latest year.

Debt to Capital Ratios

Reported debt to capital ratio steadily declines from 0.61 in 2018 to 0.44 in 2021, with a subsequent rise to 0.49 in 2022. Adjusted figures show a similar pattern but remain slightly higher, moving from 0.61 to 0.54 over the same period. The data suggests a reduction in the proportion of capital structure financed through debt, with some reversal in the most recent year.

Financial Leverage Ratios

Reported financial leverage declines from 2.89 in 2018 to 2.16 in 2021, then increases to 2.53 in 2022. Adjusted figures show a comparable trend with values moving from 2.91 to 2.26 before rising to 2.74. This pattern aligns with the changes in debt related ratios, indicating fluctuating use of debt in the capital structure which impacts leverage levels.

Net Profit Margin

The reported net profit margin turned positive in 2019 after a negative value in 2018, peaking at 25.62% in 2020 before dropping to 6.32% in 2021 and then recovering to 11.73% in 2022. Adjusted margins confirm this pattern but are consistently lower, especially notable in 2020 when adjusted margin was significantly less than reported (11.59%). This indicates variability in profitability with a particularly strong but likely exceptional performance in 2020, followed by stabilization at moderate positive margins.

Return on Equity (ROE)

Reported ROE shifts from a negative -19.16% in 2018 to positive values thereafter, with a peak at 27.02% in 2020, declining to 6.87% in 2021 and improving to 16.01% in 2022. Adjusted ROE presents a similar trend but with more conservative figures, peaking at 13.7% in 2020 and increasing to 17.36% in 2022. The fluctuations indicate strong growth in shareholder returns around 2020 followed by moderation and recovering profitability in recent years.

Return on Assets (ROA)

The reported ROA improves from negative -6.63% in 2018 to a high of 11.5% in 2020, falls to 3.18% in 2021, and reaches 6.33% in 2022. Adjusted ROA values are consistently lower but follow the same overall direction, from -6.65% to 6.33%, indicating improving asset efficiency and profitability with some volatility. The adjusted figures suggest some adjustments reduce the apparent profitability but the positive trend is clear by the end of the period.

Revenue Trend

Revenue consistently increased from 1,031,600 thousand US dollars in 2018 to 2,909,800 thousand US dollars in 2022, demonstrating strong growth over the five-year period. The growth rate accelerated particularly between 2020 and 2022.

Total Assets Trend

The total assets showed a general upward trend, rising from 1,916,000 thousand US dollars in 2018 to 5,391,700 thousand US dollars in 2022. A notable surge occurred between 2019 and 2020, with assets nearly doubling, which may suggest significant investments or acquisitions during that period.

Reported Total Asset Turnover

The reported total asset turnover ratio fluctuated over the years, starting at 0.54 in 2018, peaking at 0.62 in 2019, then declining to a low of 0.45 in 2020. The ratio improved afterwards, reaching 0.54 again in 2022. These changes indicate variability in how effectively the company generated revenue from its asset base.

Adjusted Revenue and Adjusted Total Assets

Adjusted revenue closely mirrors the reported revenue trend with slight variations, increasing steadily from 1,031,300 thousand US dollars in 2018 to 2,920,700 thousand US dollars in 2022. Adjusted total assets also reflect a similar growth pattern to reported total assets but show less volatility and a slightly lower value in later years.

Adjusted Total Asset Turnover

The adjusted total asset turnover ratio moved in a pattern akin to the reported ratio, starting at 0.52 in 2018, rising to 0.61 in 2019, dipping to 0.47 in 2020, and then gradually increasing to 0.58 in 2022. The adjusted figures suggest a generally improving efficiency in asset utilization in the most recent years after a mid-period dip.

Overall Observations

The company exhibited sustained revenue growth throughout the period, supported by significant expansion in asset base. While asset growth outpaced revenue growth during 2019-2020, resulting in a drop in asset turnover ratios, the subsequent recovery in turnover ratios through 2022 indicates an improvement in leveraging assets to generate sales. The adjusted metrics reinforce these observations, confirming a positive trajectory in operational efficiency following a period of investment or restructuring.

Current Assets

Current assets have displayed a consistent upward trend from 2018 to 2021, increasing from approximately 1.7 billion USD to 3.68 billion USD. This growth indicates a significant expansion in liquid or near-liquid assets available to meet short-term obligations. However, in 2022, current assets slightly decreased to around 3.67 billion USD, suggesting a stabilization or minor contraction after several years of growth.

Current Liabilities

Current liabilities have increased substantially over the period. Starting at approximately 222 million USD in 2018, they saw a marked rise each year, accelerating sharply in 2022 to 1.84 billion USD from 721 million USD in 2021. This substantial increase indicates a growing short-term financial obligation load, potentially impacting liquidity and operational flexibility.

Reported Current Ratio

The reported current ratio, which measures the ability to cover short-term liabilities with short-term assets, decreased notably over the years. It started very strong at 7.64 in 2018, and despite fluctuations, it remained above 5.0 until 2021. In 2022, the ratio dropped significantly to 1.99, indicating a marked reduction in short-term liquidity and a potential strain on the ability to satisfy current liabilities.

Adjusted Current Assets and Liabilities

The adjusted figures follow a similar trend to the reported figures. Adjusted current assets increased steadily from 1.71 billion USD in 2018 to a peak near 3.69 billion USD in 2021, before slightly decreasing in 2022 to 3.68 billion USD. Adjusted current liabilities also rose consistently, from around 213 million USD in 2018 to 1.82 billion USD in 2022.

Adjusted Current Ratio

The adjusted current ratio parallels the reported ratio, starting at 8.02 in 2018 and then gradually declining over the years. The ratio remained above 5.0 until 2021 but dramatically decreased to 2.02 in 2022, reinforcing the observation of diminished short-term financial stability in the most recent year.

Overall Insights

The data reveal strong asset growth paired with rapidly escalating current liabilities, particularly in 2022. While the company maintained a high liquidity position through 2021, 2022 saw a sharp decline in both reported and adjusted current ratios, indicating potential liquidity risk. This may signal increased pressure on working capital, requiring strategic management of short-term obligations to sustain financial health.

Total debt

The total debt of the company shows an increasing trend over the five-year period. Starting from approximately 1.02 billion USD at the end of 2018, it rose moderately in 2019, followed by a substantial increase in 2020. The upward trend continued in 2021 and 2022, reaching over 2.03 billion USD, indicating a growing reliance on debt financing.

Stockholders’ equity

Stockholders’ equity exhibits a strong growth trajectory from 2018 through 2021, increasing from about 663 million USD to over 2.25 billion USD, reflecting enhanced company value and retained earnings or capital infusions. However, there is a slight decline in 2022, where equity decreased to approximately 2.13 billion USD, suggesting possible distributions, losses, or other equity-reducing activities.

Reported debt to equity ratio

The reported debt to equity ratio declines significantly from 1.53 in 2018 to a low of 0.78 in 2021, signaling improved capital structure balance and reduced financial leverage relative to equity. In 2022, the ratio increases again to 0.95, indicating a modest rise in leverage or a relative decrease in equity.

Adjusted total debt

Adjusted total debt generally trends upwards, mirroring the total debt figures but at slightly higher values across all years. This suggests the inclusion of additional liabilities or adjustments made for more reflective debt representation. The increase from roughly 1.08 billion USD in 2018 to over 2.14 billion USD in 2022 confirms the trend of increasing debt obligations.

Adjusted stockholders’ equity

Adjusted stockholders’ equity also grows from 2018 to 2021, peaking at around 2.06 billion USD, before dropping to approximately 1.84 billion USD in 2022. The adjustments imply refined equity accounting considerations, but the overall pattern aligns with the reported equity trends, notably the decline in the most recent year.

Adjusted debt to equity ratio

The adjusted debt to equity ratio decreases from 1.58 in 2018 to 0.91 in 2021, indicating improved leverage conditions under adjusted figures. However, it rises notably to 1.17 in 2022, surpassing earlier levels and signaling increased leverage or reduced equity after adjustments. This suggests a shift toward higher financial risk or altered capital structure in the latest fiscal year.

The financial data over the five-year period reveals several notable trends related to the company's debt and capital structure.

Total Debt

The total debt increased consistently each year, rising from $1,017,600 thousand at the end of 2018 to $2,034,100 thousand by the end of 2022. This represents a doubling of debt over the period, indicating a growing reliance on borrowed funds.

Total Capital

Total capital also expanded significantly, from $1,680,900 thousand in 2018 to $4,165,900 thousand in 2022. The increase in capital outpaced the growth of total debt in absolute terms, suggesting an overall growth in the company's financing base.

Reported Debt to Capital Ratio

The reported debt to capital ratio shows a declining trend from 0.61 in 2018 to a low of 0.44 in 2021, indicating a reduction in leverage relative to capital. However, this ratio increased again to 0.49 in 2022, signaling a slight reversal in the previous deleveraging trend.

Adjusted Total Debt

Adjusted total debt followed a similar trajectory to reported total debt, increasing from approximately $1,076,497 thousand in 2018 to $2,149,200 thousand in 2022. The adjustments, though slightly higher than reported debt, maintained the consistent upward trend.

Adjusted Total Capital

Adjusted total capital increased from about $1,756,597 thousand in 2018 to $3,993,900 thousand in 2022. Unlike the reported total capital, the adjusted total capital saw a peak in 2021 before marginally decreasing in 2022.

Adjusted Debt to Capital Ratio

This ratio decreased progressively from 0.61 in 2018 to 0.48 in 2021, before rising to 0.54 in 2022. The movement mirrors the pattern seen in the reported debt to capital ratio, underlining a trend of reduced leverage followed by a moderate increase in the latest year.

Overall, the data indicates an expansion in both debt and capital, with a tendency towards reducing leverage until 2021, followed by a partial increase in debt proportions relative to capital in 2022. The ratios suggest that while the company increased borrowing, it managed capital growth to balance leverage, though the recent uptick in leverage ratios might warrant attention regarding debt management going forward.

The analysis of the financial data over the five-year period reveals several key trends in the company's asset base, equity position, and leverage ratios.

Total Assets

The total assets have shown a consistent upward trend, increasing from $1,916,000 thousand in 2018 to $5,391,700 thousand in 2022. This growth indicates ongoing expansion in the company's asset base, with a particularly notable acceleration between 2019 and 2020, where assets nearly doubled.

Stockholders’ Equity

Stockholders' equity also experienced growth through most of the period, rising from $663,300 thousand in 2018 to a peak of $2,251,500 thousand in 2021. However, in 2022, equity decreased to $2,131,800 thousand, suggesting some equity reduction or losses during the final year reported. Despite this decline, the overall equity increased substantially over the full period.

Reported Financial Leverage (Total Assets / Stockholders’ Equity)

The reported financial leverage ratio exhibited a decline from 2.89 in 2018 to 2.16 in 2021, indicating a deleveraging trend where equity grew faster than assets, improving the company's capitalization. However, in 2022, the ratio increased again to 2.53, signifying a higher relative level of liabilities or debt financing compared to equity during that year.

Adjusted Total Assets

Adjusted total assets follow a similar pattern to total assets, with overall growth from $1,982,097 thousand in 2018 to $5,057,800 thousand in 2022. There is a notable exception in 2020, where adjusted assets appear somewhat lower than the unadjusted total assets, possibly reflecting conservative adjustments applied during that year.

Adjusted Stockholders’ Equity

This metric increased from $680,100 thousand in 2018 to a peak of $2,057,000 thousand in 2021, before declining to $1,844,700 thousand in 2022. The trend is consistent with the reported equity but at slightly different levels, indicating that adjustments impact the equity figures systematically but do not alter the overarching pattern.

Adjusted Financial Leverage

The adjusted financial leverage ratio decreases from 2.91 in 2018 to 2.26 in 2021, paralleling the reported leverage trend and evidencing a strengthening equity base relative to assets. The ratio then rises to 2.74 in 2022, consistent with the observed uptick in reported leverage, suggesting a recalibration in the company's funding strategy or financial structure in the final year.

In summary, the company demonstrates sustained asset growth and equity accumulation over the observed period, with a trend toward lower leverage until 2021. The partial reversal of this deleveraging in 2022 highlights a shift that could be attributed to increased liabilities, reduced equity, or a combination of factors. Adjusted figures corroborate the primary data trends, reinforcing the insights into changes in financial leverage and capitalization ratios.

The financial data exhibits notable fluctuations and significant growth across several key metrics over the five-year period analyzed.

Net Income (Loss)

The company experienced a considerable turnaround in net income, progressing from a substantial loss of approximately $127.1 million in 2018 to consistent profitability in subsequent years. Net income increased sharply to $101.1 million in 2019 and further to $493.6 million in 2020, indicating a peak in profitability. However, there was a decline in 2021 to $154.7 million, followed by a recovery and strengthening to $341.2 million in 2022.

Revenue

Revenue demonstrated a steady and strong upward trend throughout the period. Starting at around $1.03 billion in 2018, revenue rose continuously each year to reach nearly $2.91 billion by the end of 2022. This represents substantial organic growth, more than doubling revenue in five years.

Reported Net Profit Margin

The reported net profit margin reflected the pattern observed in net income, shifting from negative territory (-12.32% in 2018) to positive margins in subsequent years. Peaks were seen in 2020 with a margin of 25.62%, which then contracted to 6.32% in 2021 but recovered partially to 11.73% in 2022. The margin fluctuations suggest variability in cost control or expense recognition impacting profitability.

Adjusted Net Income (Loss)

Adjusted net income trends closely mirrored the reported net income, starting with a loss of $131.8 million in 2018 and turning positive in 2019 with $100.1 million. Adjusted income rose significantly in 2020 to $223.4 million, decreased slightly in 2021 to $146.4 million, and rose again to $320.2 million in 2022. The adjustments appear to smooth out some of the volatility seen in reported net income, resulting in less pronounced peaks.

Adjusted Revenue

Adjusted revenue follows the pattern of reported revenue with marginal differences. It started at about $1.03 billion in 2018 and reached approximately $2.92 billion in 2022, indicating consistent top-line growth. The close alignment of adjusted and reported revenue suggests minimal significant accounting adjustments impacting revenue recognition.

Adjusted Net Profit Margin

The adjusted net profit margin similarly transitioned from negative (-12.78% in 2018) to positive margins, peaking at 11.59% in 2020, then dropping to 5.98% in 2021 and recovering to 10.96% in 2022. This pattern indicates stabilization of profitability when non-recurring items are excluded, though margins remain below the 2020 peak.

Overall, the data reveals a company moving from losses to sustained profitability and experiencing significant revenue growth. While profitability margins have shown some volatility, likely driven by operational or one-time factors, the general trajectory is positive, marked by expanding scale and improved financial performance.

Net Income (Loss)

The net income shows a significant improvement from a loss of $127.1 million in 2018 to a positive income of $101.1 million in 2019. This upward trajectory continued, reaching a peak of $493.6 million in 2020, followed by a decline to $154.7 million in 2021, and then increasing again to $341.2 million in 2022. The fluctuations suggest volatility in earnings but an overall positive growth trend over the five-year period.

Stockholders’ Equity

Stockholders’ equity increased consistently from $663.3 million in 2018 to a high of $2.2515 billion in 2021, reflecting strong capital accumulation. However, there is a slight decrease to $2.1318 billion in 2022, indicating a minor contraction but maintaining a substantially higher level compared to the earlier years.

Reported Return on Equity (ROE)

The reported ROE indicates a recovery from a negative return of -19.16% in 2018 to a positive return of 11.45% in 2019. It then surged to 27.02% in 2020, reflecting strong profitability relative to equity that year. This was followed by a drop to 6.87% in 2021 before improving to 16.01% in 2022. The pattern mirrors earnings performance but suggests variability in the efficiency of equity use.

Adjusted Net Income (Loss)

The adjusted net income trend resembles that of reported net income, with a negative value of $131.8 million in 2018, transitioning to positive $100.1 million in 2019, and increasing to $223.4 million in 2020. It then slightly decreased in 2021 to $146.4 million before rising again to $320.2 million in 2022. The adjustments appear to temper the peaks and troughs observed in the reported figures.

Adjusted Stockholders’ Equity

Adjusted stockholders’ equity steadily grew from $680.1 million in 2018 to $2.057 billion in 2021, followed by a decrease to $1.845 billion in 2022. The trend follows a similar pattern to reported equity but on a somewhat lower scale, indicating conservative adjustments that slightly reduce the equity base.

Adjusted Return on Equity (ROE)

Adjusted ROE moves in a comparable direction to reported ROE, starting from -19.38% in 2018, rising to 11.15% in 2019, then peaking at 13.7% in 2020. It drops slightly to 7.12% in 2021, before recovering to 17.36% in 2022. This indicates that adjusted profitability ratios offer a more moderated view of returns, smoothing out some volatility seen in reported figures.

Net Income (Loss)

The net income experienced a significant turnaround from a loss of $127.1 million in 2018 to a profit of $101.1 million in 2019. This profitability continued to improve markedly in 2020, reaching $493.6 million, followed by a decline in 2021 to $154.7 million, and then a rebound to $341.2 million in 2022. Overall, the trend shows strong growth in profitability with some volatility in the intermediate years.

Total Assets

Total assets demonstrated consistent growth throughout the period. Starting from $1.916 billion in 2018, assets increased annually to reach $5.392 billion by 2022. The most substantial increase occurred between 2019 and 2020, indicating major asset accumulation or acquisitions during that year.

Reported Return on Assets (ROA)

The reported ROA mirrored the net income trend. It was negative at -6.63% in 2018, improved substantially to 4.22% in 2019, and peaked at 11.5% in 2020. This was followed by a drop to 3.18% in 2021, and then a recovery to 6.33% in 2022. The pattern suggests the company's efficiency in using its assets to generate profit improved significantly from 2018 to 2020, faced a decline, and partially recovered afterward.

Adjusted Net Income (Loss)

The adjusted net income shows a similar trajectory to the reported net income, indicating consistent adjustments without large distortions. The figure shifted from a loss of $131.8 million in 2018 to a profit of $100.1 million in 2019, rising to $223.4 million in 2020. In 2021, adjusted net income slightly decreased to $146.4 million but recovered strongly to $320.2 million in 2022. These adjusted results confirm the overall profitability improvement over the years.

Adjusted Total Assets

Adjusted total assets also exhibit a steady increase over the five-year period, starting at approximately $1.982 billion in 2018 and growing to $5.058 billion in 2022. This aligns closely with the trend seen in reported total assets, suggesting adjustments did not materially change the asset base representation.

Adjusted Return on Assets (Adjusted ROA)

The adjusted ROA followed the adjusted net income and adjusted total assets trends. It was negative at -6.65% in 2018, increased to 4.17% in 2019, and peaked at 5.47% in 2020. Then, it declined to 3.15% in 2021 and improved again to 6.33% in 2022. The adjusted ROA values are generally lower than the reported ROA in the peak year, suggesting some adjustments lowered the apparent profitability ratios but overall show the same direction and cyclical pattern.