Great product but does that justify the stock price?
I've been using the Dexcom for over two years, and it is absolutely the best product of its kind on the market.
However I find it hard to believe that with only one product they will last long. The product is for a limited market of Type I diabetics, I would believe that if this was for Type II the price would be justified.
Unfortunately, that market is growing.
I wouldn't be upset of losing all my DXCM investment when cure is found.
The key development for Dexcom was FDA approval for pediatrics.
Read the transcripts of CC. Dexcom can last and prosper on one product - one of the main revenue streams is consumables (the sensors that you change every 7 days). They are going to introduce new 15 days sensors but the price will double as I understand , so price per day will stay the same. That's from transcript.
They still maintain quite high margins.
I am not so sure about Type 2 - many people said that you can manage it really well by just changing your diet and lifestyle. In this case CGM is extremely handy tool. I can imagine 'rent CGM for a year' model to newly diagnosed Type 2 people.
Overall, their business model , i think, depends mostly on medical insurance regulations.
Here in US, insulin pumps are common for T1D people but somewhere in ,say, Argentina or India people are still using syringes as pumps (and supplies) are too costly. Same is with CGMs. Dexcom is only tapping on the top of the global problem.