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Valued at $17.1 billion by market cap, Quest Diagnostics Incorporated (DGX) is a leader in diagnostic testing services. Based in Secaucus, New Jersey, the company specializes in providing a broad range of diagnostic information services, including clinical testing and risk assessment solutions, both in the U.S. and internationally.
Shares of this medical laboratory operator have underperformed the broader market over the past 52 weeks. DGX has gained 16.3% over this time frame, while the broader S&P 500 Index ($SPX) has soared 27.5%. In 2024, shares of Quest Diagnostics are up 11.6%, compared to SPX’s 17.8% gain on a YTD basis.
However, zooming in further, DGX has outpaced the S&P Healthcare Services SPDR’s (XHS) 11.2% gain over the past 52 weeks and 10.8% return on a YTD basis.
Despite beating Q2 earnings results and raising full-year forecasts, shares of Quest Diagnostics fell 4.3% on Jul. 23 due to concerns over a reduction in gross profit margins and slower-than-expected revenue growth. Additionally, investors were cautious about the pending acquisition of LifeLabs, which added to the uncertainty.
For the current fiscal year, ending in December, analysts expect DGX’s EPS to grow 2.1% year over year to $8.89. The company’s earnings surprise history is promising. It beat the consensus estimates in all of the last four quarters.
Among the 15 analysts covering the stock, the consensus rating is a “Moderate Buy.” That’s based on five “Strong Buy” ratings and 10 “Holds.”
The configuration is slightly more bullish than three months ago, with four analysts suggesting a “Strong Buy.”
On Jul. 29, Piper Sandler raised its price target on Quest Diagnostics to $150 and gave the stock a "neutral" rating. As of writing, DGX is trading above the mean price target of $152. However, the Street-high price target of $173 implies a potential upside of 12.4% from the current price.
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.
