DexCom, Inc. DXCM 0.71% shares got hammered Sept. 28 when rival Abbott Laboratories ABT 1.17% received FDA approval for its FreeStyle Libre flash glucose monitoring system. Investors see Abbott’s new system as a lower-priced alternative to DexCom’s continuous glucose monitoring, and shares plummeted 36 percent following the news.
DexCom stock traded as low as $42.62 following the news, its lowest level since 2014.
DexCom delivered an incredible rally for long-term investors that kicked off at under $10 per share at the beginning of 2012 and ended at $103.29 in late 2015. Since that time, the stock has traded mostly sideways in a wide range between $60 and $100. DexCom only once dipped below $50 in the past two years, a brief, intraday drop to $47.92 back in February 2016. That dip was quickly followed by a bounce back up to $68 by month’s end.
This time around, it seems as though DexCom is happy to stay below $50 for the long-haul. The stock initially bounced as high as $50.31 but was hit with selling pressure than sent it back down below $48.
Without a major catalyst ahead, the stock may continue to drift sideways or down for a while. Until the stock can close back above $50, there is potential for further downside if the stock closes below $45 and/or dips below $42.62 on an intraday basis.
The stock was hit by a wave of downgrades following the news, but only Wedbush and Canaccord have stepped up to reiterate bullish ratings.
In terms of support, the $45–$50 level previously served…
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