Goldman Sachs Bullish On Dexcom And Insulet As Diabetes Tech Surges

Goldman Sachs analyst David Roman initiated coverage on three companies, explaining that diabetes technology, including insulin pumps and continuous glucose monitors (CGMs), is expected to grow at a strong double-digit pace.

Insulet

Goldman Sachs initiated coverage on Insulet Corporation PODD, citing the company to benefit from accelerating the adoption of patch pump technology as it is the only participant in the category currently.

Goldman Sachs initiated Insulet on Thursday with a Buy rating and a price target of $380. The analyst highlights the company’s pipeline, which can potentially strengthen its relative position. Sustained top-line growth should support outsized adjusted EBITDA results and yield meaningful upside over the next several years.

Analyst David Roman writes, “We expect Omnipod's superior form factor and relative differentiation as a result to be the key contributor to Insulet's share capture as the insulin pump market moves into its next leg of adoption. In our view, the company is best positioned for the opportunities ahead in insulin delivery growth.”

Also Read: FDA Approves Dexcom’s 15-Day Wearable Glucose Management System. Company Plans US Launch

Dexcom

Goldman Sachs initiated DexCom Inc DXCM with a Buy rating and a price target of $104, supported by a constructive view of the company’s technology and long-term opportunity set.

Roman adds the potential upside from consumer-related adoption and strong P&L leverage, which should continue through the balance of 2025.

“Taking all patient cohorts into consideration, we expect Dexcom to remain ahead in the established Type 1 and Type 2 MDI segments. And in the higher growth T2 Basal and non-insulin populations, we expect Dexcom will take some patient share from Abbott over the intermediate term, off a much lower relative base…”

The CGM market is still mainly a two-player race between Abbott Laboratories ABT and DexCom, Roman says.

However, the pump market is becoming more crowded, with more companies entering and customer needs changing. Hence, Goldman Sachs reiterated Abbott as a Buy and Tandem Diabetes Care, Inc TNDM as Neutral.

Also Read: Insulet Posts Strong Q1 Results, Raises Forecasts On Momentum In US And Abroad

Beta Bionics

Goldman Sachs initiated coverage on newly listed Beta Bionics, Inc. BBNX. The diabetes management solutions provider closed its upsized IPO of 13.8 million at $17 per share in January, raising approximately $212.1 million in gross proceeds.

The analyst initiated a Neutral rating and a price target of $16, noting the company's iLet technology is well-suited for a targeted segment of the Type 1 market.

• iLet is still in the early adoption phase, so its short-term growth is expected to be stronger than that of other diabetes-related companies and similar-sized medical technology firms.
• Also, market estimates mostly reflect the growth potential over the next few years. The stock's valuation also seems to factor in this expected growth and the likelihood that the company will need to raise more money to reach break-even cash flow.

Price Action: PODD stock is up 0.14% at $324.31, BBNX stock is up 10% at $16.90, and DXCM stock is up 1% at $85.71 at the last check Friday.

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