Quest Diagnostics (DGX)
NYSEHealth CareMedical - Diagnostics & ResearchSnapshot 2026-09-04
$237.14-0.94%
Close 2026-09-04 · 1-day change
NYSEHealth CareMedical - Diagnostics & ResearchSnapshot 2026-09-04
Intact: The reason to own it still holds.
Quest Diagnostics keeps growing revenue about 7% a year. Profit per share is rising toward $9.68 in 2026. Free cash flow is strong at $1.75 billion. The company buys back stock and gains new test approvals to boost growth.
Revenue and EPS recently fell sharply in late 2025. Management has struggled to improve growth and earnings. Rising competition or regulatory issues could hurt results.
The price is about 4% above our fair value near $202 but 10% below the Street median near $225. Analysts expect a large revenue decline of about -60%, which we view as unjustified given recent growth and guidance.
Breaks if: no buyback authorization or buybacks halted
Breaks if: EPS falls below $9.0 in FY26
Breaks if: free cash flow falls below $1.5 billion in FY26
This is not a price target or investment advice.
A long-form read on the 1–3 year hold thesis. It updates when the weekly evidence changes.
DGX is positioned as a durable compounder with a focus on revenue and earnings growth. The current thesis state is intact, supported by recent strong financial performance and management's consistent execution of priorities.
The valuation is considered cheap compared to peers, with a notable expectations gap. The market appears to be pricing in a stable outlook, but there is potential for an unjustified reaction if guidance changes.
Fundamentals are likely to continue showing strong growth, as management has consistently raised revenue and EPS guidance. However, there is a moderate risk due to potential economic headwinds that could impact performance.
The thesis hinges on maintaining revenue and earnings growth while navigating potential economic challenges. Key forward scenarios include the performance of sector bellwethers and the overall economic landscape affecting healthcare stocks.
The most important moves since the prior daily snapshot.
Yes, our read has strengthened. The latest earnings beat supports a positive outlook for revenue growth. Additionally, the company raised its EPS growth outlook, reinforcing confidence in its financial performance. There are no new threats impacting the thesis.
as of 2026-09-04
Review the evidence to watch, what would become a concern, and what would make it less concerning.
Not investment advice. Scores describe historical and current data; they are not forecasts of future returns. Consult a licensed advisor before making investment decisions.
Breaks if: revenue falls below $11.0 billion in FY26
In the next 1 to 3 years, DGX's strong management and sector support may lead to continued growth, but external economic factors could pose risks. Not investment advice.