Quest Diagnostics Inc.

DGX
Financial Analysis · Updated May 13, 2026 · Coverage 2026-Q2
TTM ROIC
9.8%
FY2025 · NOPAT / Total Invested Capital (Equity + Net Debt) · WACC ~7.5% · Moat spread +2.3pp

Financial Snapshot

ticker: DGX step: 04 generated: 2026-05-13 source: quick-research

Quest Diagnostics Inc. (DGX) — Financial Snapshot

Income Statement Summary

Metric FY2022 FY2023 FY2024 YoY
Revenue $9.88B $9.25B $9.87B +6.7%
Gross Margin ~33% ~33% ~33%
Operating Margin ~16% ~14% ~14%
Net Income ~$970M ~$730M ~$750M +2.7%
EPS (adjusted diluted) ~$10.00 ~$8.71 ~$8.93 +2.5%

FY2022 elevated by residual COVID testing revenue. FY2023 decline reflects COVID normalization (~$500M+ revenue loss). FY2024 recovered on organic base growth (+3-4% ex-acquisitions) + acquisition contributions. FY2025: $11.04B revenue (+11.8%), adjusted EPS $9.85 — strong Q4 beat driven by LifeLabs + hospital outreach acquisitions.

Cash Flow & Balance Sheet (FY2024)

Metric Value
Operating Cash Flow $1.33B
Free Cash Flow ~$879M ($1.33B OCF − $454M capex)
Capital Expenditures $454M
Cash & Equivalents ~$600M
Total Debt ~$5.0B
Adjusted EBITDA ~$1.8B (~18% margin)

Key Ratios (approximate)

  • P/E: ~18x (adjusted) | EV/EBITDA: ~13x | FCF Yield: ~5%
  • Revenue Growth (FY2025): +11.8% (acquisitions + organic) | Organic growth: ~4-5%
  • Gross Margin: ~33% (consistent) | EBITDA Margin: ~18%
  • Net Debt / EBITDA: ~2.5x — manageable for stable cash flow business

Growth Profile

Quest's "true" organic growth rate is mid-single digits — the COVID boom/bust created a distorted 2022-2023 comparison. Excluding COVID revenue, the core diagnostic testing business grows at ~4-5% annually through a combination of volume growth and mix shift toward higher-value advanced testing (oncology, genomics, brain health). Acquisition strategy is consistent: buying hospital outreach lab operations that bring captive volumes into Quest's lower-cost network. LifeLabs ($1.35B, closed 2024) added Canadian scale. FY2025 Q1 showed 11% volume growth YoY — among the highest organic volume quarters in years.

Forward Estimates

  • FY2026 guidance: $11.70-$11.82B revenue (+6-7%); diluted EPS $9.45-$9.65
  • FY2025 adjusted EPS: $9.85 (beat consensus $9.72)
  • Analyst consensus FY2026 adj. EPS: ~$9.55
  • Dividend: $0.86/quarter ($3.44 annualized); 6.7% increase in 2025, 7.5% increase for 2026
  • Mean analyst price target: ~$197 (12 analysts covering; consensus Hold)

Deeper Financial Analysis

The fundamental tier adds 9 additional research dimensions for $DGX.

Revenue Breakdown
Segment revenue, geographic mix, product-line contribution margins, and cohort dynamics.
Financial Trends
Quarter-over-quarter momentum, leading indicators, and inflection point analysis.
Balance Sheet
Debt structure, liquidity runway, dilution risk, and working capital dynamics.
Capital Allocation
Buyback cadence, M&A appetite, dividend policy, and reinvestment priorities.
Returns on Capital (ROIC)
Multi-year ROIC vs. WACC, marginal returns on reinvestment, sales-to-invested-capital efficiency, and moat spread.
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Markdown: /stocks/dgx/financials/md · → thesis · → memo