Quest Diagnostics (DGX) AI Stock Analysis

• Market Cap: $20.80B
• Dividend Yield: 1.68%
• Average Volume (3M): 1.12M
• Price to Earnings (P/E): 21.9
• Beta (1Y): 0.18
• 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: 1,110,076
• 30 Day Avg. Volume: 1,117,391
• 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: 1.33
• Enterprise Value/Revenue: 2.54
• Enterprise Value/Gross Profit: 7.64
• Enterprise Value/Ebitda: 12.91
• 1Y Price Target: $201.70
• Price Target Upside: 8.33% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 11
• EPS Forecast (FY): 9.81
• Revenue Forecast (FY): $10.98B

• Rating: 70 Outperform
• Price Target: $192.00 ▲(3.12% Upside)

Quest Diagnostics' strong financial performance and positive earnings call are the most significant factors driving the stock score. The company's strategic acquisitions and operational improvements have resulted in robust growth, reflected in the raised full-year guidance. However, technical analysis indicates potential bearish momentum, which slightly offsets the positive outlook. The valuation is fair, with a reasonable P/E ratio and a modest dividend yield.

Positive Factors

Advanced Diagnostics Expansion

The expansion into advanced diagnostics, including Alzheimer's testing, positions Quest Diagnostics as a leader in innovative healthcare solutions, driving long-term revenue growth and market competitiveness.

Operational Excellence

Operational improvements and cost savings initiatives enhance efficiency, supporting margin sustainability and long-term profitability.

Acquisitions Driving Growth

Strategic acquisitions like LifeLabs expand Quest's market presence and service offerings, bolstering revenue streams and competitive positioning.

Negative Factors

Revenue Per Requisition Decline

A decline in revenue per requisition suggests pricing pressures or changes in service mix, potentially impacting profitability if not addressed.

Potential Legislative Impacts

Legislative changes could affect Quest's volumes and reimbursement rates, posing risks to revenue stability and growth.

Debt Fluctuations

Fluctuating debt levels can strain financial flexibility, impacting Quest's ability to invest in growth opportunities and manage economic downturns.

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 diagnostic testing services. The company earns money by performing laboratory tests for healthcare providers, hospitals, and patients, billing insurance companies and patients directly for these services. Key revenue streams include routine testing, which constitutes a significant portion of their business, and specialized testing, such as genetic and molecular diagnostics. Additionally, Quest Diagnostics has established partnerships with numerous healthcare organizations and payers, which help to expand their reach and enhance service offerings. The company also derives income from health and wellness programs, providing employers with testing services that promote employee health and manage healthcare costs.

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: Positive
• Last Price: 186.19
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For DGX, the sentiment is Positive. The current price of 186.19 is above the 20-day moving average (MA) of 181.41, above the 50-day MA of 182.72, and above the 200-day MA of 174.25, indicating a bullish trend. The MACD of 1.15 indicates Negative momentum. The RSI at 56.83 is Neutral, neither overbought nor oversold. The STOCH value of 72.48 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for DGX.

Quest Diagnostics Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
IQV	77 Outperform	$37.57B	29.67	19.55%	―	3.85%	-4.74%
ILMN	73 Outperform	$18.44B	27.03	31.20%	―	-2.39%	―
DGX	70 Outperform	$20.80B	21.94	13.69%	1.68%	13.74%	14.87%
RVTY	66 Neutral	$10.51B	46.37	3.04%	0.29%	3.37%	-18.80%
NTRA	64 Neutral	$28.19B	―	-29.02%	―	38.17%	-28.77%
EXAS	62 Neutral	$12.70B	―	-34.54%	―	14.47%	-353.69%
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.