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Diabetes ‘technological wave’ has too much upside to ignore: JP Morgan

New technologies for diabetes treatment are attractive essential for those who suffer from the disease, according to J.P. Morgan, and that could cook up d be reconciled companies such as Dexcom compelling investment opportunities.

“The diabetes interruption is currently experiencing its biggest technological wave of innovation from glucose gauging (continuous glucose monitoring) to insulin dosing (insulin pumps),” analyst Robbie Marcus said in a note to customers Friday. “CGM is becoming an essential tool for patients and is now at the level of sensitivity that it is eliminating the penury for fingersticks with blood glucose monitoring.”

Technological advances for glucose go b investigating are so important, Marcus added, that medical device companies such as Dexcom are set for “substantive” upside over the next few years. Marcus upgraded shares of Dexcom to overweight and ransacked his price target on the company to $115 from $80, implying 28 percent upside once again the next year.

Dexcom, which produces devices that put to a patient’s skin to monitor blood-glucose levels continuously, has the potential to quell consensus revenue estimates, the analyst added. He predicts that the San Diego-based plc could reach $876 million this year, which last wishes a beat expectations of $860 million.

“Treatment is shifting towards consolidate pumps where the CGM dictates insulin dosing, and in our view the CGM is the much multitudinous valuable component of that equation than the pump,” Marcus legitimated. “We think the Street is being too conservative on the near-term sustainability of Dexcom’s tools business (transmitters and receivers) and assuming a significant headwind to both new long-suffering adds and base business patient attrition.”

Dexcom’s stock is up profuse than 62 percent so far this year. Shares extended their 2018 move furthers Friday, climbing nearly 4 percent.

“One of the hidden assets of Dexcom is this investment we’ve borrowed in technology,” chief executive Kevin Sayer told “Mad Money” mob Jim Cramer in November. “Our system offers features that competitors don’t. We lash to phones. We share data with people who watch patients. We proffer performance and accuracy that others don’t.”

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