Quest Diagnostics Sees Analyst Optimism Despite Mixed Ratings

In recent months, analyst ratings for Quest Diagnostics have displayed a mix of optimism and caution. While the company reports a 14.55% revenue growth, its return on equity raises concerns among investors, reflecting challenges in leveraging shareholder equity effectively.

Date: 05-03-2025

AI Rating: 6

Analyst Ratings Overview: In the past three months, 11 analysts have offered a wide spectrum of ratings on Quest Diagnostics (NYSE: DGX). As reported, 2 are bullish, 3 somewhat bullish, while 6 express indifference. Notably, there was an absence of bearish sentiments in the last month.

Financial Insights: The company’s revenue saw impressive growth, noted at 14.55%, which is a positive indication for potential investors. However, this figure is below the industry average, indicating that while growth is occurring, it may not be at a competitive pace.

Net Margin and Profitability: Quest Diagnostics showcases a strong net margin of 8.39%, exceeding industry averages. This suggests effective cost management and profitability levels that could instill confidence among investors.

Return on Equity (ROE): The company’s ROE stands at 3.24%, which is below industry benchmarks. This low figure indicates potential issues in generating satisfactory returns for shareholders, which could deter investors looking for companies with efficient use of equity capital.

Debt Management: Quest Diagnostics has a debt-to-equity ratio of 1.05, less than the industry average. This indicates that the firm is managing its debt levels well, which could be a positive factor for investors concerned about financial stability.

Price Targets: Analysts set an average price target of $178.45 for Quest Diagnostics, with an estimated increase from previous targets. This rise reflects growing confidence in the company's stock amidst a backdrop of mixed performance.

Overall, while there are several encouraging indicators for Quest Diagnostics, challenges in ROE and revenue growth relative to peers remain key considerations for investors evaluating this stock.

Stocks: DGX