DexCom Shorts Tick Up as Stock Drops 8% Before Earnings

DXCM shares fell 8.4% over the past week to $78.56, against a median gain of roughly 2% for its closest medical device peers. Into that slide, short sellers added positions: short interest rose 8.2% in a single session on October 26 and is up nearly 6% over the week, reaching 4.1% of the free float at around 16 million shares. Despite the uptick, the borrow market tells a different story. Availability is exceptionally loose at over 2,100%, meaning there are more than 21 times the shares available to lend relative to what is already borrowed. Cost to borrow has edged up about 22% over the week but remains a low 0.47%. The options put/call ratio at 0.74 is modestly above its 20-day average and sits near the lower half of its 52-week range, far from any distress signal.

Analyst opinion is one of the more bullish-leaning features of the setup. The consensus sits well to the buy side, with the mean price target at around $96, implying roughly 22% upside from current levels. Barclays initiated coverage with an Overweight rating and a $115 target on October 7. RBC Capital and BTIG both raised targets earlier this month to $105 and $96 respectively. The bull case centres on the CONNECT trial, which showed a 1.6% A1c reduction versus 0.7% for controls and roughly 21% improvement in time-in-range, alongside the long runway in Type 2 non-insulin users and the Stelo software platform. Bears point to sensor limitations for side sleepers, payor pricing pressure, the risk that CGM penetration stalls, and a valuation that still carries a price-to-earnings multiple near 26x even after the recent de-rating: the P/E has compressed by about 3 points over the past 30 days.

One additional weight on the stock beyond the print itself: ORTEX puts the probability of DXCM being deleted from the Nasdaq-100 at the December 2026 Annual Review at 62%. The exit line is at a market cap of $38 billion, roughly 28% above where the company trades today. If that threshold is not reached by the November 30 rank date, index trackers would need to sell an estimated $2.6 billion worth of shares, equivalent to about 7.3 days of normal volume, with the effective date set for December 21. Past deletions of this type have seen median price declines of 3.5% between announcement and effective date, with 79% moving in that direction, though history is not a forecast.

All of the above makes the October 29 print less a test of whether DexCom is growing and more a question of whether the company can signal enough revenue momentum and margin progress to close the gap between the stock's current price and a consensus that sits nearly a quarter above it.