Quest Diagnostics (DGX) AI Stock Analysis

• Market Cap: $20.30B
• Dividend Yield: 1.73%
• Average Volume (3M): 1.10M
• Price to Earnings (P/E): 21.4
• Beta (1Y): 0.15
• Revenue Growth: 13.74%
• EPS Growth: 14.87%
• Country: US
• Employees: 55,000
• Sector: Healthcare
• Sector Strength: 45
• Industry: Medical - Diagnostics & Research
• EPS (TTM): 2.60
• Shares Outstanding: 111,242,360
• 10 Day Avg. Volume: 993,564
• 30 Day Avg. Volume: 1,099,439
• PEG Ratio: 6.95
• Price to Book (P/B): 2.47
• Price to Sales (P/S): 1.70
• P/FCF Ratio: 18.42
• Enterprise Value/Market Cap: 1.36
• Enterprise Value/Revenue: 2.54
• Enterprise Value/Gross Profit: 7.64
• Enterprise Value/Ebitda: 12.91
• 1Y Price Target: $200.78
• Price Target Upside: 11.78% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 11
• EPS Forecast (FY): 9.81
• Revenue Forecast (FY): $10.98B

• Rating: 79 Outperform
• Price Target: $219.00 ▲(21.92% Upside)

Quest Diagnostics receives a strong overall score driven by robust financial performance, positive technical indicators, and a favorable earnings call. The company's strategic focus on acquisitions and advanced diagnostics supports its growth potential. While valuation is fair, the raised guidance and successful collaborations enhance investor confidence.

Positive Factors

Strong Revenue Growth

The robust revenue growth, particularly organic growth, indicates strong demand for Quest's services and effective integration of acquisitions, supporting long-term business expansion.

Successful Collaborations

Strategic partnerships and joint ventures enhance Quest's service offerings and market reach, bolstering its competitive position and potential for sustained growth.

Advanced Diagnostics Expansion

Expansion in advanced diagnostics positions Quest as a leader in specialized testing, meeting growing healthcare needs and driving future revenue streams.

Negative Factors

Potential Impact of PAMA

Potential PAMA-related payment cuts could reduce revenue from Medicare services, impacting Quest's financial performance and market position.

Higher Employee Health Costs

Rising employee healthcare costs can pressure margins, affecting profitability and financial flexibility in the long term.

Investment Costs

High investment costs for Project Nova could strain short-term margins, though they may support long-term growth if successful.

Quest Diagnostics Business Overview & Revenue Model

Company Description

Quest Diagnostics Incorporated provides diagnostic testing, information, and services in the United States and internationally. The company develops and delivers diagnostic information services, such as routine testing, non-routine and advanced clinical testing, anatomic pathology testing, and other diagnostic information services. It offers diagnostic information services primarily under the Quest Diagnostics brand, as well as under the AmeriPath, Dermpath Diagnostics, ExamOne, and Quanum brands to patients, clinicians, hospitals, independent delivery networks, health plans, employers, direct contract entities, and accountable care organizations through a network of laboratories, patient service centers, phlebotomists in physician offices, call centers and mobile paramedics, nurses, and other health and wellness professionals. The company also provides risk assessment services for the life insurance industry; and healthcare organizations and clinicians robust information technology solutions. Quest Diagnostics Incorporated was founded in 1967 and is headquartered in Secaucus, New Jersey.

How the Company Makes Money

Quest Diagnostics generates revenue primarily through its laboratory services, which include a wide array of diagnostic tests performed on patient samples. The company operates on a fee-for-service model, billing healthcare providers, hospitals, and patients for the tests conducted. Key revenue streams include clinical laboratory services, which constitute the bulk of its earnings, as well as revenue from its esoteric testing, which involves more complex and specialized tests. Additionally, Quest Diagnostics benefits from partnerships with health plans, hospitals, and physician practices that facilitate access to its services. The company also engages in strategic collaborations, such as with pharmaceutical companies for clinical trials and testing services, further enhancing its revenue potential.

Quest Diagnostics Financial Statement Overview

Summary

Quest Diagnostics demonstrates a solid financial performance with stable revenue growth, efficient operations, and strong cash flow generation. The balance sheet reflects a balanced leverage and effective equity utilization. Despite some revenue volatility and debt fluctuations, the company maintains a strong financial position in the medical diagnostics industry.

Income Statement

Quest Diagnostics shows a stable revenue growth of 3.12% in the TTM, with a consistent gross profit margin around 33%. The net profit margin is slightly below 9%, indicating moderate profitability. The EBIT and EBITDA margins are healthy, reflecting efficient operations. However, the revenue growth has been volatile in recent years, with periods of decline.

Balance Sheet

The company's debt-to-equity ratio has improved to 0.88 in the TTM, indicating a balanced leverage. Return on equity is strong at 13.75%, showcasing effective use of equity. The equity ratio is stable, suggesting a solid financial structure. However, the company has experienced fluctuations in debt levels over the years.

Cash Flow

Quest Diagnostics exhibits a robust free cash flow growth of 13.81% in the TTM, with a strong operating cash flow to net income ratio of 0.88. The free cash flow to net income ratio is healthy at 0.74, indicating good cash generation relative to earnings. The company has shown consistent improvement in cash flow metrics.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	10.85B	9.87B	9.25B	9.88B	10.79B	9.44B
Gross Profit	3.61B	3.24B	3.07B	3.43B	4.21B	3.63B
EBITDA	2.14B	1.89B	1.73B	1.82B	3.16B	2.41B
Net Income	969.00M	871.00M	854.00M	946.00M	2.00B	1.43B
Balance Sheet
Total Assets	16.20B	16.15B	14.02B	12.84B	13.61B	14.03B
Cash, Cash Equivalents and Short-Term Investments	432.00M	549.00M	686.00M	315.00M	872.00M	1.16B
Total Debt	6.38B	7.09B	5.50B	4.71B	4.77B	4.81B
Total Liabilities	8.82B	9.26B	7.60B	6.83B	7.05B	7.13B
Stockholders Equity	7.26B	6.78B	6.31B	5.89B	6.44B	6.76B
Cash Flow
Free Cash Flow	1.39B	909.00M	864.00M	1.31B	1.83B	1.59B
Operating Cash Flow	1.89B	1.33B	1.27B	1.72B	2.23B	2.00B
Investing Cash Flow	-942.00M	-2.55B	-1.06B	-543.00M	21.00M	-772.00M
Financing Cash Flow	-1.27B	1.08B	160.00M	-1.73B	-2.54B	-1.27B

Quest Diagnostics Technical Analysis

• Technical Analysis Sentiment: Neutral
• Last Price: 179.62
• 50DMA: Negative
• 100DMA: Positive
• 200DMA: Positive
• MACD: Positive
• RSI: Neutral
• STOCH: Positive

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For DGX, the sentiment is Neutral. The current price of 179.62 is below the 20-day moving average (MA) of 186.51, below the 50-day MA of 183.70, and above the 200-day MA of 175.78, indicating a neutral trend. The MACD of 0.03 indicates Positive momentum. The RSI at 43.70 is Neutral, neither overbought nor oversold. The STOCH value of 8.58 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for DGX.

Quest Diagnostics Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
DGX	79 Outperform	$20.30B	21.42	13.69%	1.73%	13.74%	14.87%
QGEN	77 Outperform	$10.19B	25.36	11.29%	3.29%	5.32%	336.29%
NTRA	73 Outperform	$33.75B	―	-29.02%	―	38.17%	-28.77%
EXAS	70 Outperform	$19.18B	―	-34.54%	―	14.47%	-353.69%
WAT	70 Outperform	$23.50B	36.11	32.99%	―	6.90%	3.86%
GH	61 Neutral	$13.20B	―	―	―	30.38%	24.17%
Sector *	51 Neutral	$7.86B	-0.30	-43.30%	2.27%	22.53%	-2.21%

Quest Diagnostics Corporate Events

Quest Diagnostics Reports Strong Q3 2025 Results

Quest Diagnostics Incorporated, a leading provider of diagnostic information services, announced its third-quarter financial results for 2025, highlighting significant growth in revenue and earnings. The company operates in the healthcare sector, offering diagnostic insights from laboratory testing to improve health outcomes.