One-glance verdict
Within fair range
$281.04 our estimate vs market $251.82
Wall Street consensus: $257.27 (-8.5% lower than our fair-value estimate)
10% below our estimate
Fundamentals snapshot
Quest Diagnostics Incorporated
DGX · NYQ · Healthcare · Diagnostics & Research
Current price
$251.82
52-week range
$171.18 - $256.99
Market cap
$27.79B
Balance sheet
Watch
5.62x Adequate
Net debt $5.60B. Interest coverage shows how many times profit covers the interest bill.
What stands out
3 Rewards
3 Risks
3 rewards · 3 risks
- Reward Revenue grew 7.3% last year.
- Reward Returns 15.3% on equity, ahead of 60% of its peers.
- Risk Net debt grew 40.1% over 3 years.
- Risk Stock trades 29.5% above its 5-year average P/E.
What this company does
Quest Diagnostics Incorporated
Quest Diagnostics provides a wide range of medical testing services, from routine blood work to specialized cancer diagnostics, to doctors, hospitals, and even directly to consumers. Their main income comes from these laboratory tests and related services, which are essential for diagnosing illnesses and guiding treatment decisions. This means their business is heavily influenced by healthcare trends and the demand for accurate medical information to keep people healthy.
How the company got here
Quest Diagnostics started in 1967 as a small independent laboratory with a big idea: to make medical testing more accessible and affordable. Over the decades, it grew by acquiring other labs and expanding its services, becoming a major player in the diagnostic industry. A key turning point was its focus on building a vast network of testing facilities and patient service centers across the United States, making it convenient for people to get tests done close to home. This expansion allowed Quest to handle a massive volume of tests, solidifying its position as a leader in diagnostic information services.
What it actually does
Quest Diagnostics is essentially a giant medical testing company. Think of it as the behind-the-scenes expert that doctors and hospitals rely on to figure out what's going on with a patient's health. When your doctor orders a blood test, a urine test, or even a more complex tissue analysis, Quest is often the company that performs that test in its labs. They then send the results back to your doctor, helping them make informed decisions about your care. They offer a wide range of tests, from routine check-ups to specialized analyses for serious diseases.
Diagnostic Testing Services
This is the core of Quest's business, where they perform a huge variety of medical tests. Doctors, hospitals, and even patients order these tests to understand health conditions, monitor treatments, or screen for diseases. This includes everything from basic blood counts and cholesterol checks to more advanced genetic tests and cancer screenings. Quest makes money by charging for each test performed, and this segment represents the largest portion of their overall revenue, serving as the backbone of their operations.
Anatomic Pathology
This specialized area involves examining tissues and cells under a microscope to diagnose diseases, particularly cancer. When a doctor takes a biopsy, for example, the tissue sample is sent to an anatomic pathologist, often working with Quest, to determine if it's cancerous and what type. This service is crucial for cancer diagnosis and treatment planning, and it's a significant, high-value part of Quest's offerings, though smaller than their general diagnostic testing volume.
Risk Assessment Services
Quest also provides services primarily for the life insurance industry. When someone applies for life insurance, the insurance company often needs to assess their health risks. Quest conducts medical exams, collects health information, and performs tests for these applicants. This helps insurance companies decide whether to issue a policy and at what price. This segment is a smaller but important revenue stream, leveraging Quest's network for health data collection.
Healthcare IT and Data Solutions
Beyond just running tests, Quest offers technology solutions to help healthcare providers and insurance companies manage patient data and improve care. This includes systems for electronic health records and tools that help analyze patient information to identify health trends or manage populations. While not as large as their core testing business, these IT services are a growing area, helping Quest integrate more deeply into the healthcare ecosystem and generate additional revenue.
What management is betting on now
Quest's leadership is focused on expanding their advanced testing capabilities, especially in areas like oncology (cancer) and genetics, to address more complex health needs. They are also investing in technology to make their services more efficient and accessible, including improving their digital platforms for doctors and patients. Another key strategy is growing their relationships with health plans and employers to offer more comprehensive wellness and preventative care services, aiming to capture a larger share of the healthcare spending by focusing on better health outcomes and data insights.
Price history
How the share price has moved
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Earnings history
Last 8 quarters — what happened
Click any quarter to read the call summary and what the numbers say.
FY2024 Q4
$341.00M
FY2025 Q1
$197.00M
FY2025 Q2
$436.00M
FY2025 Q3
$419.00M
FY2025 Q4
$307.00M
FY2026 Q1
$164.00M
FY2026 Q2
$459.00M
FY2026 Q3
$445.00M
Revenue
$3.10B
Net income
$312.00M
Diluted EPS
2.78
Operating cash flow
$611.00M
Free cash flow
$445.00M
Fetching…
Sources
Revenue
$3.04B
Net income
$320.00M
Diluted EPS
2.84
Operating cash flow
$597.00M
Free cash flow
$459.00M
Fetching…
Sources
Revenue
$2.90B
Net income
$252.00M
Diluted EPS
2.24
Operating cash flow
$278.00M
Free cash flow
$164.00M
Fetching…
Sources
Revenue
$2.81B
Net income
$245.00M
Diluted EPS
2.18
Operating cash flow
$465.00M
Free cash flow
$307.00M
Fetching…
Sources
Revenue
$2.82B
Net income
$245.00M
Diluted EPS
2.16
Operating cash flow
$563.00M
Free cash flow
$419.00M
Fetching…
Sources
Revenue
$2.76B
Net income
$282.00M
Diluted EPS
2.47
Operating cash flow
$544.00M
Free cash flow
$436.00M
Fetching…
Sources
Revenue
$2.65B
Net income
$220.00M
Diluted EPS
1.94
Operating cash flow
$314.00M
Free cash flow
$197.00M
Fetching…
Sources
Revenue
$2.62B
Net income
$222.00M
Diluted EPS
1.95
Operating cash flow
$464.00M
Free cash flow
$341.00M
Fetching…
Sources
Is it cheap or expensive?
Fair value $281.04 vs current price $251.82
Wall Street consensus is the average analyst price target: $257.27 (-8.5% lower than our fair-value estimate).
Our most-likely fair value is $281.04 a share — about 11.6% away from today's price of $251.82, so the stock currently looks fairly priced.
Is it drowning in debt?
Watch
Net debt $5.6B. Interest coverage 5.6x.
Net debt
$5.60B
Interest coverage
5.62x
Quest Diagnostics Incorporated's profit covers its interest bill about 5.6 times over. which is stronger than most peers shown here.
Watch
Worse cushion
Baseline
Better cushion
DGX
BASELINE
Quest Diagnostics Incorporated
Total debt $6.40B Interest coverage 5.62x This is the baseline the peer rows are being compared against.
Total debt $6.78B Interest coverage 6.77x +20% vs DGX Carries about 1.2x more debt cushion than DGX.
Total debt $16.31B Interest coverage 3.14x -44% vs DGX Carries about 1.8x less debt cushion than DGX.
Total debt $3.03B Interest coverage 3.75x -33% vs DGX Carries about 1.5x less debt cushion than DGX.
Total debt $1.37B Interest coverage 4.46x -21% vs DGX Carries about 1.3x less debt cushion than DGX.
What you should know
The case for and against DGX
3 Rewards
3 Risks
Rewards
-
Revenue grew 7.3% last year.
-
Returns 15.3% on equity, ahead of 60% of its peers.
-
Free cash flow was positive in 10/10 years.
Risks
-
Net debt grew 40.1% over 3 years.
-
Stock trades 29.5% above its 5-year average P/E.
-
Insider ownership is only 0.4% (peer median: 0.8%).
The numbers
All the key metrics, grouped by purpose
Tap any ? icon to learn what it means.
Valuation
How expensive the stock looks
P/E (TTM)
25.08x
Forward P/E
21.02x
P/B
3.63x
P/S
2.35x
EV/EBITDA
14.33x
PEG ratio
1.65x
Profitability
How much profit each dollar creates
Gross margin
33.2%
Operating margin
15.6%
Net margin
9.5%
ROE
15.3%
ROA
6.6%
Health
Liquidity and balance-sheet strength
Debt / equity
0.80x
Current ratio
1.70x
Quick ratio
1.37x
Total debt
$6.40B
Total cash
$797.00M
Growth
How the business has been compounding
Revenue TTM
$11.84B
Revenue 5Y CAGR
0.6%
EPS TTM
10.04
EPS 5Y CAGR
3.2%
Cash flow
How much cash the business throws off
Operating CF TTM
$1.95B
Free CF TTM
$1.36B
FCF margin
11.5%
Dividend
Shareholder payout
Yield
1.4%
Payout ratio
25.1%
Last ex-div date
2026-10-06