The ongoing market volatility has many investors considering where to invest their capital. While there is no surefire way to predict which stocks will perform well in the coming months, there are a few companies that are worth keeping an eye on. Two such companies are DexCom and Chewy.
DexCom’s Growth-Oriented Healthcare Stock
DexCom (DXCM), a growth-oriented healthcare stock, has been making waves in the market lately. The company’s market-leading portfolio of continuous glucose monitoring devices has a large and growing market opportunity. With only about 3-4% of individuals with type 2 diabetes wearing a CGM in the US, there is still a massive addressable market for DexCom’s devices.
The company’s latest G7 device has a faster warm-up time and is 60% smaller than its predecessor, making it more user-friendly. This could potentially lead to an increase in demand for DexCom’s products. In 2022, DexCom’s revenue soared 19%, while profits jumped nearly 60%. This strong performance has caught the attention of investors looking for growth opportunities in the healthcare sector.
Chewy’s Online Retailer in the Pet Care Industry
Chewy (CHWY), an online retailer in the pet care industry, is another company that is carving out a prolonged runway to growth. The industry hit a valuation of over $280 billion globally as of 2022, and Chewy is well-positioned to benefit from this growth. The company’s growing network of automated fulfillment centers streamlines the order processing and delivery timeline for customers, making it an attractive option for pet owners.
One of Chewy’s key strengths is its subscription program, Autoship, which generated 73% of net sales in 2022. This program allows customers to set up recurring deliveries of their pet’s favorite products, providing a steady stream of revenue for Chewy. The company generated $119 million in free cash flow in 2022, ending the year with about $677 million in cash and investments on its balance sheet.
Why Invest in DexCom and Chewy?
DexCom’s market-leading portfolio of continuous glucose monitoring devices and Chewy’s growing network of automated fulfillment centers and subscription program make both companies attractive options for investors looking for growth opportunities in the healthcare and pet care industries, respectively. With more and more pet owners turning to online shopping for their pet care needs, Chewy is well-positioned to continue growing in the coming years.
In the case of DexCom, the demand for its products is likely to increase as more people become aware of the benefits of continuous glucose monitoring. The company’s devices are a game-changer for individuals with type 2 diabetes, allowing them to manage their condition more effectively. As DexCom continues to innovate and improve its devices, its market share is likely to grow.
Chewy, on the other hand, has a diversified business model that taps into the many different targets of pet spending. From food and toys to grooming and healthcare products, Chewy offers a one-stop-shop for pet owners. The company’s subscription program is a particularly attractive offering, providing customers with the convenience of recurring deliveries and Chewy with a predictable revenue stream.
While the market continues to experience volatility, investors should consider stocks with strong growth potential and a clear path to success. DexCom and Chewy are two companies worth watching as they continue to perform well in their respective industries. DexCom’s market-leading portfolio of continuous glucose monitoring devices and Chewy’s growing network of automated fulfillment centers and subscription program make both companies attractive options for investors looking for growth opportunities in the healthcare and pet care industries
