Common Stock Valuation Ratios (Price Multiples)
Valuation ratios measure the quantity of an asset or flaw (e.g., earnings) associated with ownership of a specified claim (e.g., a share of ownership of the enterprise).
Current Valuation Ratios
DexCom Inc., current price multiples
| DexCom Inc. | Abbott Laboratories | Elevance Health Inc. | Intuitive Surgical Inc. | Medtronic PLC | UnitedHealth Group Inc. | Health Care Equipment & Services | Health Care | ||||
|---|---|---|---|---|---|---|---|---|---|---|---|
| Selected Financial Data | |||||||||||
| Current share price (P) | $81.09 | ||||||||||
| No. shares of common stock outstanding | 386,373,935 | ||||||||||
| Growth rate (g) | 10.22% | ||||||||||
| Earnings per share (EPS) | $0.88 | ||||||||||
| Next year expected EPS | $0.97 | ||||||||||
| Operating profit per share | $1.01 | ||||||||||
| Sales per share | $7.53 | ||||||||||
| Book value per share (BVPS) | $5.52 | ||||||||||
| Valuation Ratios (Price Multiples) | |||||||||||
| Price to earnings (P/E) | 91.83 | 26.87 | 15.17 | 50.12 | 23.62 | 28.04 | 21.70 | 29.79 | |||
| Price to next year expected earnings | 83.31 | 24.91 | 13.57 | 43.94 | 23.30 | 24.98 | 19.46 | 26.06 | |||
| Price-earnings-growth (PEG) | 8.98 | 3.43 | 1.28 | 3.57 | 17.24 | 2.29 | 1.89 | 2.08 | |||
| Price to operating profit (P/OP) | 80.09 | 21.76 | 13.07 | 48.60 | 17.53 | 17.82 | 16.52 | 23.27 | |||
| Price to sales (P/S) | 10.77 | 3.95 | 0.43 | 14.22 | 3.12 | 0.76 | 1.53 | 4.36 | |||
| Price to book value (P/BV) | 14.70 | 3.36 | 1.96 | 8.03 | 2.29 | 3.59 | 3.99 | 7.39 | |||
Based on: 10-K (reporting date: 2022-12-31).
If the company price multiple is lower then the price multiple of benchmark then company stock is relatively undervalued.
Otherwise, if the company price multiple is higher then the price multiple of benchmark then company stock is relatively overvalued.
Historical Valuation Ratios (Summary)
DexCom Inc., historical price multiples
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 valuation ratios demonstrate a period of significant volatility and high market premiums, characteristic of growth-oriented pricing. While several multiples peaked between 2019 and 2021, a general trend toward compression is evident by the end of 2022.
- Price to Earnings (P/E) Ratio
- The P/E ratio exhibits extreme fluctuations, ranging from a low of 79.93 in 2020 to a peak of 255.37 in 2021. This substantial variance suggests significant shifts in net income relative to market price or highly volatile investor expectations regarding future earnings growth.
- Price to Operating Profit (P/OP) Ratio
- A general downward trajectory is observed in the P/OP ratio, which decreased from 162.33 in 2019 to 105.93 by 2022. This decline indicates that operating profits expanded more rapidly than the stock price over the period, despite a brief increase in 2021.
- Price to Sales (P/S) Ratio
- The P/S ratio experienced an upward trend from 12.76 in 2018, peaking at 20.48 in 2020. Following this peak, the ratio contracted steadily to 14.24 by the end of 2022, suggesting a normalization of the revenue multiple.
- Price to Book Value (P/BV) Ratio
- The P/BV ratio remained consistently high throughout the period, indicating a significant premium over the company's net asset value. After reaching a peak of 26.17 in 2019, the ratio fluctuated and concluded the period at 19.44 in 2022.
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Price to Earnings (P/E)
DexCom Inc., historical P/E calculation, comparison to benchmarks
| Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | Dec 31, 2018 | ||
|---|---|---|---|---|---|---|
| No. shares of common stock outstanding1 | 386,413,690 | 388,262,536 | 384,709,452 | 366,376,568 | 360,007,068 | |
| Selected Financial Data (US$) | ||||||
| Net income (loss) (in thousands) | 341,200) | 154,700) | 493,600) | 101,100) | (127,100) | |
| Earnings per share (EPS)2 | 0.88 | 0.40 | 1.28 | 0.28 | -0.35 | |
| Share price1, 3 | 107.24 | 101.75 | 102.55 | 63.05 | 36.56 | |
| Valuation Ratio | ||||||
| P/E ratio4 | 121.45 | 255.37 | 79.93 | 228.49 | — | |
| Benchmarks | ||||||
| P/E Ratio, Competitors5 | ||||||
| Abbott Laboratories | 26.76 | 29.13 | — | — | — | |
| Elevance Health Inc. | 19.20 | 18.13 | — | — | — | |
| Intuitive Surgical Inc. | 64.99 | 59.94 | — | — | — | |
| Medtronic PLC | 23.38 | 46.56 | — | — | — | |
| UnitedHealth Group Inc. | 22.46 | 26.03 | — | — | — | |
| P/E Ratio, Sector | ||||||
| Health Care Equipment & Services | 24.26 | 28.98 | — | — | — | |
| P/E Ratio, Industry | ||||||
| Health Care | 21.22 | 21.55 | — | — | — | |
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).
1 Data adjusted for splits and stock dividends.
2 2022 Calculation
EPS = Net income (loss) ÷ No. shares of common stock outstanding
= 341,200,000 ÷ 386,413,690 = 0.88
3 Closing price as at the filing date of DexCom Inc. Annual Report.
4 2022 Calculation
P/E ratio = Share price ÷ EPS
= 107.24 ÷ 0.88 = 121.45
5 Click competitor name to see calculations.
The financial data from 2018 to 2022 indicates a period of significant share price appreciation and a transition from net losses to inconsistent profitability. The valuation multiples throughout this period remain elevated, suggesting high investor expectations for future growth despite volatility in actual earnings performance.
- Share Price Trend
- A consistent upward trajectory in share price is observed, rising from 36.56 US$ in 2018 to 107.24 US$ by the end of 2022. The most substantial growth occurred between 2018 and 2020, after which the price stabilized and experienced marginal gains.
- Earnings per Share (EPS) Performance
- The company shifted from a negative EPS of -0.35 US$ in 2018 to positive territory in 2019. Earnings peaked in 2020 at 1.28 US$ before experiencing a sharp decline to 0.40 US$ in 2021 and a subsequent partial recovery to 0.88 US$ in 2022. This volatility indicates inconsistent bottom-line performance during the growth phase.
- Price-to-Earnings (P/E) Ratio Analysis
- The P/E ratio exhibits extreme volatility, closely mirroring the fluctuations in EPS. Because the company reported losses in 2018, no P/E ratio was applicable for that period. Following the transition to profitability in 2019, the ratio was exceptionally high at 228.49, dropping to 79.93 in 2020 as earnings surged. The ratio spiked again to 255.37 in 2021 due to the contraction in EPS while the share price remained steady, before moderating to 121.45 in 2022. These figures reflect a high-growth valuation profile where the market price is significantly decoupled from current earnings.
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Price to Operating Profit (P/OP)
DexCom Inc., historical P/OP calculation, comparison to benchmarks
| Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | Dec 31, 2018 | ||
|---|---|---|---|---|---|---|
| No. shares of common stock outstanding1 | 386,413,690 | 388,262,536 | 384,709,452 | 366,376,568 | 360,007,068 | |
| Selected Financial Data (US$) | ||||||
| Operating income (loss) (in thousands) | 391,200) | 265,800) | 299,500) | 142,300) | (186,300) | |
| Operating profit per share2 | 1.01 | 0.68 | 0.78 | 0.39 | -0.52 | |
| Share price1, 3 | 107.24 | 101.75 | 102.55 | 63.05 | 36.56 | |
| Valuation Ratio | ||||||
| P/OP ratio4 | 105.93 | 148.63 | 131.73 | 162.33 | — | |
| Benchmarks | ||||||
| P/OP Ratio, Competitors5 | ||||||
| Abbott Laboratories | 22.18 | 24.45 | — | — | — | |
| Elevance Health Inc. | 15.05 | 15.70 | — | — | — | |
| Intuitive Surgical Inc. | 54.49 | 56.11 | — | — | — | |
| Medtronic PLC | 20.48 | 37.44 | — | — | — | |
| UnitedHealth Group Inc. | 15.89 | 18.77 | — | — | — | |
| P/OP Ratio, Sector | ||||||
| Health Care Equipment & Services | 18.47 | 22.66 | — | — | — | |
| P/OP Ratio, Industry | ||||||
| Health Care | 16.58 | 18.20 | — | — | — | |
Based on: 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31).
1 Data adjusted for splits and stock dividends.
2 2022 Calculation
Operating profit per share = Operating income (loss) ÷ No. shares of common stock outstanding
= 391,200,000 ÷ 386,413,690 = 1.01
3 Closing price as at the filing date of DexCom Inc. Annual Report.
4 2022 Calculation
P/OP ratio = Share price ÷ Operating profit per share
= 107.24 ÷ 1.01 = 105.93
5 Click competitor name to see calculations.
Between 2018 and 2022, a significant expansion in both market valuation and operational profitability was observed. The transition from a negative operating profit per share in 2018 to positive territory in 2019 established a basis for calculating price multiples, reflecting a fundamental shift in the company's financial performance.
- Share Price Performance
- A strong upward trajectory in share price is evident, rising from 36.56 US$ in 2018 to 107.24 US$ by 2022. The most aggressive growth occurred between 2018 and 2020, after which the price stabilized and fluctuated within a tighter range above 100 US$.
- Operating Profitability Trends
- Operating profit per share moved from a deficit of -0.52 US$ in 2018 to a peak of 1.01 US$ in 2022. While a slight contraction occurred in 2021, where profit per share dipped to 0.68 US$, the overall five-year trend indicates consistent improvement in operational efficiency and earnings power.
- Price to Operating Profit (P/OP) Analysis
- The P/OP ratio exhibited a general downward trend following its initial recording of 162.33 in 2019. Despite a temporary increase to 148.63 in 2021, the ratio declined to 105.93 by the end of 2022. This contraction suggests that the growth in operating profit has partially kept pace with the increase in share price, resulting in a lower valuation multiple over time.
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Price to Sales (P/S)
DexCom Inc., historical P/S calculation, comparison to benchmarks
| Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | Dec 31, 2018 | ||
|---|---|---|---|---|---|---|
| No. shares of common stock outstanding1 | 386,413,690 | 388,262,536 | 384,709,452 | 366,376,568 | 360,007,068 | |
| Selected Financial Data (US$) | ||||||
| Revenue (in thousands) | 2,909,800) | 2,448,500) | 1,926,700) | 1,476,000) | 1,031,600) | |
| Sales per share2 | 7.53 | 6.31 | 5.01 | 4.03 | 2.87 | |
| Share price1, 3 | 107.24 | 101.75 | 102.55 | 63.05 | 36.56 | |
| Valuation Ratio | ||||||
| P/S ratio4 | 14.24 | 16.13 | 20.48 | 15.65 | 12.76 | |
| Benchmarks | ||||||
| P/S Ratio, Competitors5 | ||||||
| Abbott Laboratories | 4.25 | 4.78 | — | — | — | |
| Elevance Health Inc. | 0.74 | 0.81 | — | — | — | |
| Intuitive Surgical Inc. | 13.81 | 17.89 | — | — | — | |
| Medtronic PLC | 3.72 | 5.57 | — | — | — | |
| UnitedHealth Group Inc. | 1.40 | 1.58 | — | — | — | |
| P/S Ratio, Sector | ||||||
| Health Care Equipment & Services | 1.71 | 2.07 | — | — | — | |
| P/S Ratio, Industry | ||||||
| Health Care | 3.11 | 3.28 | — | — | — | |
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).
1 Data adjusted for splits and stock dividends.
2 2022 Calculation
Sales per share = Revenue ÷ No. shares of common stock outstanding
= 2,909,800,000 ÷ 386,413,690 = 7.53
3 Closing price as at the filing date of DexCom Inc. Annual Report.
4 2022 Calculation
P/S ratio = Share price ÷ Sales per share
= 107.24 ÷ 7.53 = 14.24
5 Click competitor name to see calculations.
The valuation trajectory from 2018 to 2022 reflects a period of significant expansion followed by a corrective phase in the price-to-sales (P/S) multiple. While both share price and sales per share exhibited growth over the five-year period, the pace of these increases varied, leading to a peak in valuation before a subsequent contraction.
- Share Price Trends
- The share price experienced substantial growth, rising from 36.56 US$ in 2018 to 107.24 US$ in 2022. The most aggressive appreciation occurred between 2018 and 2020, after which the price entered a period of relative stabilization, fluctuating slightly around the 100 US$ level.
- Sales per Share Performance
- A consistent and linear upward trend in sales per share is observed, with values increasing every consecutive year from 2.87 US$ in 2018 to 7.53 US$ in 2022. This indicates a steady improvement in fundamental revenue generation on a per-share basis throughout the analyzed period.
- Price-to-Sales (P/S) Ratio Dynamics
- The P/S ratio rose from 12.76 in 2018 to a peak of 20.48 in 2020, signaling a period of valuation expansion where the market price increased at a rate significantly faster than revenue growth. Following the 2020 peak, the ratio contracted to 14.24 by 2022. This downward trend in the multiple occurred despite the continued growth in sales per share, suggesting a valuation compression as the market adjusted the premium paid for each dollar of revenue.
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Price to Book Value (P/BV)
DexCom Inc., historical P/BV calculation, comparison to benchmarks
| Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | Dec 31, 2018 | ||
|---|---|---|---|---|---|---|
| No. shares of common stock outstanding1 | 386,413,690 | 388,262,536 | 384,709,452 | 366,376,568 | 360,007,068 | |
| Selected Financial Data (US$) | ||||||
| Stockholders’ equity (in thousands) | 2,131,800) | 2,251,500) | 1,826,500) | 882,600) | 663,300) | |
| Book value per share (BVPS)2 | 5.52 | 5.80 | 4.75 | 2.41 | 1.84 | |
| Share price1, 3 | 107.24 | 101.75 | 102.55 | 63.05 | 36.56 | |
| Valuation Ratio | ||||||
| P/BV ratio4 | 19.44 | 17.55 | 21.60 | 26.17 | 19.84 | |
| Benchmarks | ||||||
| P/BV Ratio, Competitors5 | ||||||
| Abbott Laboratories | 5.06 | 5.75 | — | — | — | |
| Elevance Health Inc. | 3.19 | 3.07 | — | — | — | |
| Intuitive Surgical Inc. | 7.78 | 8.59 | — | — | — | |
| Medtronic PLC | 2.24 | 3.26 | — | — | — | |
| UnitedHealth Group Inc. | 5.81 | 6.27 | — | — | — | |
| P/BV Ratio, Sector | ||||||
| Health Care Equipment & Services | 4.46 | 5.01 | — | — | — | |
| P/BV Ratio, Industry | ||||||
| Health Care | 5.26 | 5.48 | — | — | — | |
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).
1 Data adjusted for splits and stock dividends.
2 2022 Calculation
BVPS = Stockholders’ equity ÷ No. shares of common stock outstanding
= 2,131,800,000 ÷ 386,413,690 = 5.52
3 Closing price as at the filing date of DexCom Inc. Annual Report.
4 2022 Calculation
P/BV ratio = Share price ÷ BVPS
= 107.24 ÷ 5.52 = 19.44
5 Click competitor name to see calculations.
The valuation metrics from 2018 to 2022 reveal a period of significant expansion in market valuation, accompanied by a consistent increase in the underlying book value of the equity.
- Share Price Trends
- A substantial upward trajectory was observed between 2018 and 2020, during which the share price rose from 36.56 to 102.55. Following this rapid ascent, the price entered a phase of relative stability, fluctuating minimally between 2020 and 2022 to close at 107.24.
- Book Value per Share (BVPS) Evolution
- BVPS demonstrated steady growth for the majority of the analyzed period, increasing from 1.84 in 2018 to a peak of 5.80 in 2021. A slight contraction was recorded in 2022, with the value adjusting to 5.52.
- Price to Book Value (P/BV) Analysis
- The P/BV ratio remained consistently elevated throughout the period, indicating a high market premium over the accounting value of the assets. The ratio reached its peak in 2019 at 26.17, occurring as the share price grew more rapidly than the book value. A subsequent decline to 17.55 by 2021 was primarily driven by the acceleration of BVPS growth while the share price remained stagnant. By the end of 2022, the ratio moderated to 19.44, reflecting a slight increase in share price coupled with the marginal decrease in BVPS.
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