Quest Diagnostics Incorporated (DGX) Stock Analysis

Why this analysis is different

• A sector-relative MoonshotScore — five pillars (business quality, financial safety, valuation, growth durability, momentum) re-ranked nightly against the full universe of US-listed common stocks.
• An AI Council read across up to eight perspectives — value, macro, quantitative, and momentum lenses — that shows where they disagree instead of averaging the tension away.
• Figures come straight from FMP and Yahoo Finance filings data. The AI writes the narrative around the numbers — it never edits the numbers.

Quest Diagnostics Incorporated (DGX) Healthcare & Pipeline Overview

Quest Diagnostics Incorporated (DGX) is a leading provider of diagnostic testing, information, and services, operating under brands like Quest Diagnostics, AmeriPath, and ExamOne. With a $26.7B market cap and a 9.1% profit margin, DGX serves a wide range of healthcare stakeholders through its extensive network of laboratories and service centers.

What Is the Investment Thesis for DGX?

Quest Diagnostics presents a stable investment opportunity within the healthcare sector, supported by its established market position and consistent profitability. With a market capitalization of $26.7B and a P/E ratio of 17.4, the company demonstrates financial stability. A gross margin of 33.2% and a profit margin of 9.1% indicate efficient operations. Growth catalysts include expanding diagnostic services and strategic partnerships. Potential risks include regulatory changes and increased competition from companies like Labcorp Holdings Inc. (LH) and Illumina, Inc. (ILMN). The dividend yield of 1.74% offers a steady return for investors, making DGX a potentially noteworthy option for long-term portfolios.

Based on FMP financials and quantitative analysis

DGX Key Highlights

Market Cap of $26.7B indicates a strong market presence and investor confidence.

• P/E ratio of 17.4 suggests a reasonable valuation relative to earnings.
• Profit Margin of 9.1% demonstrates efficient operations and profitability.
• Gross Margin of 33.2% reflects effective cost management in service delivery.
• Dividend Yield of 1.74% provides a steady income stream for investors.

Who Are DGX's Competitors?

DGX is benchmarked below against 8 industry peers on price, market cap, and our AI MoonshotScore.

AI Score by Stock Expert AI · Price data: FMP / Yahoo Finance

What Are DGX's Key Strengths?

Extensive network of laboratories and patient service centers.

• Established brand reputation and recognition.
• Comprehensive range of diagnostic testing services.
• Strong relationships with healthcare providers and payers.

What Are DGX's Weaknesses?

Dependence on reimbursement rates from government and private payers.

• Exposure to regulatory changes and healthcare reforms.
• Competition from other diagnostic testing providers.
• Potential for technological obsolescence.

What Could Drive DGX Stock Higher?

Expansion of advanced clinical testing services, including molecular diagnostics and genetic testing.

• Strategic partnerships with healthcare providers to enhance market reach and service integration.
• Growth in direct-to-consumer testing, providing consumers with direct access to diagnostic tests.
• Leveraging data analytics and IT solutions to improve clinical decision-making and resource allocation.
• Geographic expansion in international markets to tap into new growth opportunities.

What Are the Key Risks for DGX?

Increased competition from established and emerging players in the diagnostic testing market.

• Dependence on reimbursement rates from government and private payers, subject to change.
• Technological advancements that could disrupt the market and require significant investment.
• Economic downturns that could reduce healthcare spending and impact revenue.
• Regulatory changes and healthcare reforms that could affect the company's operations and profitability.

What Are the Growth Opportunities for DGX?

• Expansion of Advanced Clinical Testing Services: Quest Diagnostics can capitalize on the growing demand for advanced clinical testing, including molecular diagnostics and genetic testing. The market for molecular diagnostics is projected to reach $12.5 billion by 2028, driven by advancements in personalized medicine and the increasing prevalence of genetic disorders. By investing in cutting-edge technologies and expanding its test menu, Quest Diagnostics can attract new customers and increase revenue from higher-margin specialized tests. Timeline: Ongoing.
• Strategic Partnerships with Healthcare Providers: Collaborating with hospitals, physician groups, and integrated delivery networks can enhance Quest Diagnostics' market reach and service integration. These partnerships can streamline testing processes, improve patient care coordination, and secure long-term contracts. The healthcare provider market is increasingly focused on value-based care, creating opportunities for diagnostic companies to demonstrate their contribution to improved outcomes and cost efficiency. Timeline: Ongoing.
• Growth in Direct-to-Consumer Testing: The direct-to-consumer (DTC) testing market is experiencing rapid growth, driven by increased consumer awareness and demand for convenient, accessible healthcare services. Quest Diagnostics can expand its DTC offerings, providing consumers with direct access to a range of diagnostic tests, including wellness panels, genetic screening, and infectious disease testing. This can generate new revenue streams and enhance brand visibility. The DTC testing market is projected to reach $3.5 billion by 2027. Timeline: Ongoing.
• Leveraging Data Analytics and IT Solutions: Quest Diagnostics can leverage its extensive database of diagnostic information to develop and offer data analytics and IT solutions to healthcare organizations. These solutions can help providers improve clinical decision-making, optimize resource allocation, and enhance patient outcomes. The market for healthcare analytics is projected to reach $35 billion by 2028, driven by the increasing adoption of electronic health records and the growing need for data-driven insights. Timeline: Upcoming.
• Geographic Expansion in International Markets: Expanding its presence in international markets can provide Quest Diagnostics with new growth opportunities and diversify its revenue streams. Emerging markets, such as Asia-Pacific and Latin America, are experiencing rapid growth in healthcare spending and demand for diagnostic services. By establishing partnerships, acquiring local laboratories, or developing new facilities, Quest Diagnostics can tap into these markets and capitalize on the increasing demand for quality diagnostic testing. Timeline: Upcoming.

What Are DGX's Competitive Advantages?

• Extensive network of laboratories and patient service centers provides broad geographic coverage.
• Established brand reputation and recognition in the diagnostic testing market.
• Comprehensive range of diagnostic testing services caters to diverse customer needs.
• Strong relationships with healthcare providers and payers.
• Proprietary technology and data analytics capabilities.

What Does DGX Do?

Quest Diagnostics Incorporated, founded in 1967 and headquartered in Secaucus, New Jersey, is a global leader in providing diagnostic testing, information, and services. The company's evolution has been marked by continuous expansion of its testing capabilities and service offerings, catering to a diverse clientele that includes patients, clinicians, hospitals, independent delivery networks, health plans, employers, and accountable care organizations. Quest Diagnostics operates primarily under the Quest Diagnostics brand, but also utilizes AmeriPath, Dermpath Diagnostics, ExamOne, and Quanum brands to deliver specialized services. These services encompass routine testing, non-routine and advanced clinical testing, anatomic pathology testing, and other diagnostic information services. The company's extensive network includes laboratories, patient service centers, phlebotomists in physician offices, call centers, and mobile paramedics. Beyond diagnostic testing, Quest Diagnostics provides risk assessment services for the life insurance industry and offers healthcare organizations and clinicians robust information technology solutions designed to improve patient care and operational efficiency. With a strong focus on innovation and customer service, Quest Diagnostics maintains a competitive position in the diagnostic testing market, adapting to evolving healthcare needs and technological advancements.

What Products and Services Does DGX Offer?

• Provides routine diagnostic testing services.
• Offers non-routine and advanced clinical testing.
• Conducts anatomic pathology testing.
• Delivers diagnostic information services to healthcare providers.
• Provides risk assessment services for the life insurance industry.
• Offers healthcare organizations robust information technology solutions.
• Operates a network of laboratories and patient service centers.

How Does DGX Make Money?

• Generates revenue through diagnostic testing services provided to patients and healthcare providers.
• Contracts with hospitals, health plans, and employers for diagnostic testing services.
• Offers specialized testing services under brands like AmeriPath and ExamOne.
• Provides IT solutions and data analytics services to healthcare organizations.

What Industry Does DGX Operate In?

Quest Diagnostics operates in the medical diagnostics and research industry, which is characterized by continuous innovation and increasing demand for advanced testing services. The industry is driven by factors such as an aging population, the rising prevalence of chronic diseases, and technological advancements in diagnostic tools. The competitive landscape includes major players like Labcorp Holdings Inc. (LH) and Illumina, Inc. (ILMN), each vying for market share through differentiated service offerings and technological capabilities. Quest Diagnostics maintains a strong position through its extensive network, brand recognition, and comprehensive range of diagnostic services.

Who Are DGX's Key Customers?

• Patients seeking diagnostic testing services.
• Clinicians and physicians ordering tests for their patients.
• Hospitals and independent delivery networks.
• Health plans and insurance companies.
• Employers offering wellness programs.

Over the past six months, Quest Diagnostics Incorporated insiders filed 29 SEC Form 4 transactions — 5 sales and 24 purchases. On net that is roughly 12K shares acquired (about $94K) — insiders putting money in tends to read as conviction.

Quarterly Financial Performance: Quest Diagnostics Incorporated

Revenue for Quest Diagnostics Incorporated came in at $3.04B during Q2 2026, a 5.1% improvement versus the preceding quarter. The company recorded net income of $320.0M, with diluted EPS of $2.84. Revenue has increased across the last three reported quarters, suggesting sustained momentum for this large-cap Healthcare company. Across the four most recent quarters, DGX averaged $2.35 in diluted EPS.

DGX Valuation & Market Position

With a $26.7B market cap, Quest Diagnostics Incorporated sits in the large-cap segment of the market. Relative to its peer group, DGX's quantitative score of 74/100 is below the peer average of 90/100.

Return on equity for Quest Diagnostics Incorporated stands at 14.5%, a gauge of how efficiently it converts shareholder capital into profit. Return on assets is 6.3%, showing how much profit it generates from its asset base. DGX trades at a trailing price-to-earnings ratio of 17.40, below the Healthcare sector average of ~23x. Its free cash flow yield is 0.0%, a gauge of the cash the business throws off relative to its market value. A current ratio of 1.18 indicates the company holds enough short-term assets to cover its near-term obligations. Its earnings yield is 0.0%, the inverse of the P/E and a quick read on earnings relative to price.

Quest Diagnostics Incorporated's Piotroski F-Score is 7/9, a 9-point checklist of profitability, leverage and efficiency — signaling solid underlying fundamentals. Its Altman Z-Score of 3.65 places it in the safe zone, indicating low near-term bankruptcy risk.

Quest Diagnostics Incorporated has beaten Wall Street's EPS estimate in 8 of its last 8 reported quarters — a consistent record of delivering on expectations. Reported results have landed about 3.9% above estimates on average.

Wall Street analysts project Quest Diagnostics Incorporated revenue of about $12.01B for fiscal 2026, with EPS near $11.19. The estimate reflects 13 contributing analysts.

Company Profile

Quest Diagnostics Incorporated operates in the Medical - Diagnostics & Research industry within the Healthcare sector. It is headquartered in Secaucus, US. The company is led by CEO James E. Davis. DGX has traded publicly since 1996.

DGX Financials

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DGX Analyst Consensus

DGX MoonshotScore

Latest Quest Diagnostics Incorporated Analysis

What Investors Ask About Quest Diagnostics Incorporated (DGX) — Healthcare

Disclaimer: This content is for informational purposes only and does not constitute investment advice. Always do your own research and consult a financial advisor.

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