We recently compiled a list of the 12 Best Internet of Things Stocks To Buy According to Analysts. In this article, we are going to take a look at where DexCom, Inc. (NASDAQ:DXCM) stands against the other IoT stocks.
Trends and Outlook for The Internet of Things Industry
According to the IOT analytics, 2024 was a poor year for the Internet of Things sector, particularly due to the headwinds from the hardware sector. As per the report published on January 15, many IoT-centric industries experienced stunted year-over-year growth. The industrial software market grew 12% year-over-year, slightly slower than the growth in 2023, whereas the industrial hardware industry experienced market declines. However, despite the slowdown the number of IoT connected devices grew around 13% year-over-year, surpassing 18 billion. In addition, the expertise spending related to IoT also increased by 10% year-over-year to reach $298 billion in 2024. The report also highlighted that the discussion on IoT remained high among leading CEO’s of the technology industry. The public relevance of the term Internet of Things remained within 30% of its all-time high in 2022.
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Moreover, another report by McKinsey & Company states that IoT can offer significant economic value potential. The report highlights that IoT can unlock $5.5 trillion to $12.6 trillion in economic value by consumer IoT products and services. McKinney & Company predicts that the most economic value of the technology will come from its deployment in industrial environments including manufacturing, health care, and other areas. Factory setting is expected to be the largest beneficiary by generating around $1.4 trillion to $3.3 trillion by 2030, or 26% of the total value. Lastly, the perceived value of IoT, the technological advancements, and the emergence of 5G in Networking are anticipated to be the prominent tailwinds for the sector.
Our Methodology
To compile the list of the 12 best Internet of Things stocks to buy according to analysts we used the Global X Internet of Things ETF. Using the ETF we aggregated a list of IoT stocks with positive analyst upside potential (at least 10%), sourced from CNN. Lastly, we ranked the stocks in ascending order of the analyst upside potential. Please note that the data was retrieved on Monday, 17th February, 2025.
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A doctor demonstrating how to use the medical device to a patient with diabetes.
DexCom, Inc. (NASDAQ:DXCM)
Analyst Upside Potential: 12.27%
DexCom, Inc. (NASDAQ:DXCM) is a medical device company that specializes in developing and commercializing continuous glucose monitoring (CGM) systems. These systems help people with diabetes manage their condition by providing real-time glucose level data. Their CGM system can be integrated with various devices like smartphones and insulin pumps via Bluetooth. Moreover, the Dexcom Share system enables caregivers or healthcare providers to remotely monitor a patient’s glucose levels using mobile apps.
On February 14, Travis Steed, an analyst at Bank of America Securities, maintained a Buy rating while keeping his price target of $84.09. DexCom, Inc. (NASDAQ:DXCM) has been growing its customer base. As of the fiscal fourth quarter of 2024, the company had more than 2.8 million customers globally on its G series and D series products, reflecting a significant increase from the previous year. As a result, it reported an 8% year-over-year organic revenue growth in the quarter. For fiscal year 2024, total revenue reached approximately $4.033 billion, marking an 11% increase over the previous year. Management attributed the expansion to being driven by category momentum and improved execution. It is one of the best Internet of Things stocks to buy according to analysts.
Aristotle Atlantic Focus Growth Strategy stated the following regarding DexCom, Inc. (NASDAQ:DXCM) in its Q4 2024 investor letter:
“We sold DexCom, Inc. (NASDAQ:DXCM) after the surprisingly weak second quarter earnings report and only a modest recovery in the third quarter. The U.S. sales trends remain weak, and we believe that it could take a while for Dexcom to regain the premium multiple it has historically enjoyed. Dexcom is working to fix the durable medical equipment (DME) sales channel, and this could take time. The recently announced Stelo product for non-diabetic users could add an additional level of variability to quarterly earnings reports as well.”
Overall DXCM ranks 10th on our list of the best IoT stocks to buy according to analysts. While we acknowledge the potential of DXCM as an investment, our conviction lies in the belief that AI stocks hold greater promise for delivering higher returns and doing so within a shorter time frame. If you are looking for an AI stock that is more promising than DXCM but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
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Disclosure: None. This article is originally published at Insider Monkey.
