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Quest Diagnostics (DGX - Free Report) recently completed the buyout of Shiel Medical Laboratory from Fresenius Medical Care AG & Co. KGaA (FMS - Free Report) — a healthcare company working on renal and other chronic conditions. The Shiel lab specifically serves the New York-New Jersey area. The latest development is expected to drive Quest Diagnostics’ operational excellence in the quarters to come.
The region will now be served by Quest Diagnostics’ flagship clinical laboratory in Teterboro, NJ. The takeover is expected to expand the company’s patient service center network in the area.
Quest Diagnostics and Fresenius Medical will now work on identifying patients with early-stage chronic kidney diseases, leveraging on the former’s laboratory data analytics.
Focus on Acquisitions
Quest Diagnostics’ mergers and acquisitions are expected to be key growth drivers. The company has of late been focusing on driving growth and operational efficiency through acquisitions. We note that the company recently completed the buyout of outreach laboratory service operations of Hartford HealthCare hospitals — The William W. Backus Hospital and The Hospital of Central Connecticut.
Additionally, several new collaborations with hospitals and integrated delivery networks have been major growth drivers. We are also particularly upbeat about the company’s deal with Wal-Mart Stores, Inc. (WMT - Free Report) . The company is particularly positive about its recent agreement with PeaceHealth in the Pacific Northwest, which is expected to driive growth in 2017. Also, management is optimistic about the latest acquisitions of Med Fusion and ClearPoint to advance in the diagnostics space. We are also encouraged by the company’s plan to acquire the outreach laboratory services business of Cape Cod Healthcare.
Per the company, these tuck-in acquisitions fit well within the ambit of its M&A guidelines. Quest Diagnostics’ takeover plans are consistent with its goal of contributing 1-2% to revenues annually through acquisitions. Thus, we believe this latest buyout will widen the customer base of this leading diagnostic services information provider.
Stock Performance & Estimate Revision Trend
Quest Diagnostics has been gaining investor confidence on consistently positive results. Over the last year, the company’s share price has outperformed the broader industry. The stock has gained 6.6%, in contrast to the broader industry’s decline of 5.5%.
The company’s recent earnings estimate revision has been encouraging. The current year has seen one estimate go up in the last 30 days compared to no revision in the opposite direction.
The consensus estimate for current-year earnings has risen to $5.65 from $5.64.
Myriad Genetics has a long-term expected earnings growth rate of 15%. The stock has gained 84.5% in a year’s time.
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Quest Diagnostics Buys Fresenius Medical's Shiel Laboratory
Quest Diagnostics (DGX - Free Report) recently completed the buyout of Shiel Medical Laboratory from Fresenius Medical Care AG & Co. KGaA (FMS - Free Report) — a healthcare company working on renal and other chronic conditions. The Shiel lab specifically serves the New York-New Jersey area. The latest development is expected to drive Quest Diagnostics’ operational excellence in the quarters to come.
The region will now be served by Quest Diagnostics’ flagship clinical laboratory in Teterboro, NJ. The takeover is expected to expand the company’s patient service center network in the area.
Quest Diagnostics and Fresenius Medical will now work on identifying patients with early-stage chronic kidney diseases, leveraging on the former’s laboratory data analytics.
Focus on Acquisitions
Quest Diagnostics’ mergers and acquisitions are expected to be key growth drivers. The company has of late been focusing on driving growth and operational efficiency through acquisitions. We note that the company recently completed the buyout of outreach laboratory service operations of Hartford HealthCare hospitals — The William W. Backus Hospital and The Hospital of Central Connecticut.
Additionally, several new collaborations with hospitals and integrated delivery networks have been major growth drivers. We are also particularly upbeat about the company’s deal with Wal-Mart Stores, Inc. (WMT - Free Report) . The company is particularly positive about its recent agreement with PeaceHealth in the Pacific Northwest, which is expected to driive growth in 2017. Also, management is optimistic about the latest acquisitions of Med Fusion and ClearPoint to advance in the diagnostics space. We are also encouraged by the company’s plan to acquire the outreach laboratory services business of Cape Cod Healthcare.
Per the company, these tuck-in acquisitions fit well within the ambit of its M&A guidelines. Quest Diagnostics’ takeover plans are consistent with its goal of contributing 1-2% to revenues annually through acquisitions. Thus, we believe this latest buyout will widen the customer base of this leading diagnostic services information provider.
Stock Performance & Estimate Revision Trend
Quest Diagnostics has been gaining investor confidence on consistently positive results. Over the last year, the company’s share price has outperformed the broader industry. The stock has gained 6.6%, in contrast to the broader industry’s decline of 5.5%.
The company’s recent earnings estimate revision has been encouraging. The current year has seen one estimate go up in the last 30 days compared to no revision in the opposite direction.
The consensus estimate for current-year earnings has risen to $5.65 from $5.64.
Key Pick
Quest Diagnostics carries a Zacks Rank #3 (Hold).
A better-ranked medical stock is Myriad Genetics, Inc. (MYGN - Free Report) . Notably, Myriad Genetics sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Myriad Genetics has a long-term expected earnings growth rate of 15%. The stock has gained 84.5% in a year’s time.
Will You Make a Fortune on the Shift to Electric Cars?
Here's another stock idea to consider. Much like petroleum 150 years ago, lithium power may soon shake the world, creating millionaires and reshaping geo-politics. Soon electric vehicles (EVs) may be cheaper than gas guzzlers. Some are already reaching 265 miles on a single charge.
With battery prices plummeting and charging stations set to multiply, one company stands out as the #1 stock to buy according to Zacks research.
It's not the one you think.
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