Quest Diagnostics Shines Amidst Challenges with Strong Q3 Results
Valued at a market cap of $17.1 billion, Quest Diagnostics Incorporated (DGX) stands as a top provider of diagnostic testing and services both in the U.S. and around the world. Based in Secaucus, New Jersey, the company offers routine, advanced clinical, and anatomic pathology testing through well-known brands such as Quest Diagnostics, AmeriPath, and Dermpath Diagnostics.
Classified as a “large-cap” stock, due to its market cap exceeding $10 billion, Quest Diagnostics is committed to enhancing growth and operational efficiency. The company employs a range of strategic initiatives, including disease-focused esoteric testing and partnerships with hospitals. Its extensive network includes laboratories, patient service centers, and mobile phlebotomy services, which support physicians, hospitals, insurers, and patients alike.
Currently, shares of this diagnostics and research leader are trading 7.9% below their 52-week high of $165.32, which was hit in November. Over the past three months, the company has seen a 1.2% decline, trailing the Global X Telemedicine & Digital Health ETF’s (EDOC) return of 3.2% in the same period.
On a more positive note, DGX stock has gained 10.4% year-to-date, outperforming EDOC’s minor dip. Additionally, shares of DGX have appreciated by 11.3% over the past 52 weeks, in contrast to a slight drop in EDOC during the same span.
Since late April, DGX has consistently traded above its 200-day moving average, reinforcing its promising trend.
On October 22, Quest Diagnostics shares surged 6.9% following the release of its third-quarter results, which surpassed analysts’ expectations. The company reported an adjusted earnings per share (EPS) of $2.30, exceeding consensus forecasts, alongside revenue of $2.5 billion—an increase of 8.4% year-over-year. This growth was fueled by strong demand for diagnostic tests as patients resumed previously deferred medical procedures. Additionally, the acquisition of LifeLabs has bolstered its service offerings and market presence. The company also revised its full-year revenue outlook upwards to between $9.8 billion and $9.9 billion, showcasing a positive growth outlook despite challenges such as Hurricane Milton.
DGX’s strong performance is particularly notable when compared to its competitor, Labcorp Holdings Inc. (LH), which has only gained 1.8% over the past year and displayed minimal growth year-to-date.
Despite DGX’s impressive performance, analysts maintain a cautiously optimistic outlook. The stock currently holds a consensus rating of “Moderate Buy” from 16 analysts, with a mean price target of $174.19—indicating a potential upside of 14.6% from current prices.
On the date of publication, Sohini Mondal did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information, please view the Barchart Disclosure Policy here. More news from Barchart
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