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Should You Hold Quest Diagnostics Stock in Your Portfolio for Now?
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Key Takeaways
DGX expands via acquisitions, including Spectra assets, to strengthen clinical testing services.
Advanced diagnostics drove DGX's growth in key areas like cardiometabolic, autoimmune and brain health.
Rising debt and competitive pressure from commercial and hospital labs remain concerns for DGX.
Quest Diagnostics (DGX - Free Report) invests in advanced diagnostics to deliver and scale innovative services that improve patient care and drive growth. The company seeks growth through disciplined, value-accretive acquisitions, but weak solvency metrics and strong competitive pressures raise concerns about Quest Diagnostics’ operational outlook.
In the past year, this Zacks Rank #3 (Hold) stock has rallied 17.8% against the industry’s 0.1% decline. The S&P 500 composite grew 12.4% in the same period.
The renowned provider of diagnostic information services has a market capitalization of $20.87 billion. Quest Diagnostics has an earnings yield of 5.1% compared with the industry’s 4.8%. The company’s earnings surpassed estimates in each of the trailing four quarters, delivering an average surprise of 2.5%.
Tailwinds for DGX
Progress With Acquisitions Strategy: Quest Diagnostics’ strategy focuses on generating growth through value-creating, strategically aligned acquisitions guided by disciplined investment criteria. In particular, the company places strong emphasis on accretive outreach acquisitions, as well as purchases of other independent labs. In the third quarter, DGX completed the acquisition of select clinical testing assets of Fresenius Medical Care's wholly owned Spectra Laboratories, a leading provider of renal-specific laboratory testing services in the United States.
With this acquisition, Quest will be positioned to provide dialysis-related clinical testing to independent dialysis clinics previously served by Spectra Laboratories.
In 2024, Quest Diagnostics completed eight acquisitions, including LifeLabs, which expanded its foothold in Canada, and Allina Health’s select lab assets. The company also acquired the laboratory business of three physician groups in New York.
Strong Potential of Advanced Diagnostics: Quest Diagnostics is investing in advanced diagnostics to deliver and scale innovative services that improve patient care and drive growth. The company focuses on five major clinical areas — advanced cardiometabolic, autoimmune, brain health, oncology, and women's and reproductive health — to enable growth across its customer channels.
In the third quarter of 2025, DGX posted double-digit revenue growth across several clinical areas, including advanced cardiometabolic and endocrine as well as autoimmune disease testing with the analyzer autoimmune solution.
In brain health, demand for the AD-Detect blood test for Alzheimer's disease remained strong. Quest Diagnostics also launched a new AB 42/40 and p-tau-217 panel to help identify amyloid brain pathology in symptomatic patients.
In oncology, the company received a breakthrough device designation from the FDA for its Haystack MRD test. DGX also commenced separate trials with Mass General Brigham and Rutgers Cancer Institute to further research Haystack MRD's clinical utility as a guide in making post-operative therapy decisions. In the long term, Quest Diagnostics plans to sustain the growth momentum in each of the five areas.
What Ails DGX?
Escalating Debt Level: The company’s solvency level remains a concern. At the end of the third quarter of 2025, long-term debt totaled $5.17 billion, while the cash and cash equivalent balance was only $432 million. The current portion of the debt was $504 million. Moreover, a higher debt level results in increased interest payments, which also raises the risk of failing to meet those obligations. The times interest ratio, which indicates the company’s capacity to pay interest, declined 0.2% sequentially to 5.9%.
Image Source: Zacks Investment Research
Competitive Landscape: Quest Diagnostics faces intense competition, primarily from Labcorp, other commercial laboratories and hospitals. While pricing is an important factor in choosing a testing lab, hospital-affiliated physicians expect a high level of service, including an accurate and rapid turnaround of testing results. As a result, Quest Diagnostics and other commercial labs compete with hospital-affiliated labs primarily based on the quality of service.
DGX Stock Estimate Trend
The Zacks Consensus Estimate for 2025 earnings per share (EPS) has risen 2 cents to $9.79 in the past 30 days.
The consensus estimate for the company’s 2025 revenues is pegged at $10.97 billion, which suggests 11.1% growth from the year-ago reported number.
Key Picks
Some better-ranked stocks from the broader medical space are Intuitive Surgical (ISRG - Free Report) , Medpace Holdings (MEDP - Free Report) and Boston Scientific (BSX - Free Report) .
Intuitive Surgical, carrying a Zacks Rank #1 (Strong Buy) at present, posted a third-quarter 2025 adjusted EPS of $2.40, which exceeded the Zacks Consensus Estimate by 20.6%. You can see the complete list of today’s Zacks #1 Rank stocks here.
Revenues of $2.51 billion topped the Zacks Consensus Estimate by 3.9%.
ISRG has an estimated long-term earnings growth rate of 15.7% compared with the industry’s 11.9% growth. The company’s earnings outpaced estimates in each of the trailing four quarters, the average surprise being 16.34%.
Medpace, currently carrying a Zacks Rank #2 (Buy), reported a third-quarter 2025 EPS of $3.86, which surpassed the Zacks Consensus Estimate by 10.29%. Revenues of $659.9 million beat the Zacks Consensus Estimate by 3.04%.
MEDP has an estimated earnings growth rate of 17.1% for 2025 compared with the industry’s 16.6% growth. The company beat on earnings in each of the trailing four quarters, the average surprise being 14.28%.
Boston Scientific, currently carrying a Zacks Rank #2, reported a third-quarter 2025 adjusted EPS of 75 cents, which surpassed the Zacks Consensus Estimate by 5.6%. Revenues of $5.07 billion outperformed the Zacks Consensus Estimate by 1.9%.
BSX has an estimated long-term earnings growth rate of 16.4% compared with the industry’s 13.5% growth. The company’s earnings beat estimates in each of the trailing four quarters, the average surprise being 7.36%.
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Should You Hold Quest Diagnostics Stock in Your Portfolio for Now?
Key Takeaways
Quest Diagnostics (DGX - Free Report) invests in advanced diagnostics to deliver and scale innovative services that improve patient care and drive growth. The company seeks growth through disciplined, value-accretive acquisitions, but weak solvency metrics and strong competitive pressures raise concerns about Quest Diagnostics’ operational outlook.
In the past year, this Zacks Rank #3 (Hold) stock has rallied 17.8% against the industry’s 0.1% decline. The S&P 500 composite grew 12.4% in the same period.
The renowned provider of diagnostic information services has a market capitalization of $20.87 billion. Quest Diagnostics has an earnings yield of 5.1% compared with the industry’s 4.8%. The company’s earnings surpassed estimates in each of the trailing four quarters, delivering an average surprise of 2.5%.
Tailwinds for DGX
Progress With Acquisitions Strategy: Quest Diagnostics’ strategy focuses on generating growth through value-creating, strategically aligned acquisitions guided by disciplined investment criteria. In particular, the company places strong emphasis on accretive outreach acquisitions, as well as purchases of other independent labs. In the third quarter, DGX completed the acquisition of select clinical testing assets of Fresenius Medical Care's wholly owned Spectra Laboratories, a leading provider of renal-specific laboratory testing services in the United States.
With this acquisition, Quest will be positioned to provide dialysis-related clinical testing to independent dialysis clinics previously served by Spectra Laboratories.
In 2024, Quest Diagnostics completed eight acquisitions, including LifeLabs, which expanded its foothold in Canada, and Allina Health’s select lab assets. The company also acquired the laboratory business of three physician groups in New York.
Strong Potential of Advanced Diagnostics: Quest Diagnostics is investing in advanced diagnostics to deliver and scale innovative services that improve patient care and drive growth. The company focuses on five major clinical areas — advanced cardiometabolic, autoimmune, brain health, oncology, and women's and reproductive health — to enable growth across its customer channels.
In the third quarter of 2025, DGX posted double-digit revenue growth across several clinical areas, including advanced cardiometabolic and endocrine as well as autoimmune disease testing with the analyzer autoimmune solution.
In brain health, demand for the AD-Detect blood test for Alzheimer's disease remained strong. Quest Diagnostics also launched a new AB 42/40 and p-tau-217 panel to help identify amyloid brain pathology in symptomatic patients.
In oncology, the company received a breakthrough device designation from the FDA for its Haystack MRD test. DGX also commenced separate trials with Mass General Brigham and Rutgers Cancer Institute to further research Haystack MRD's clinical utility as a guide in making post-operative therapy decisions. In the long term, Quest Diagnostics plans to sustain the growth momentum in each of the five areas.
What Ails DGX?
Escalating Debt Level: The company’s solvency level remains a concern. At the end of the third quarter of 2025, long-term debt totaled $5.17 billion, while the cash and cash equivalent balance was only $432 million. The current portion of the debt was $504 million. Moreover, a higher debt level results in increased interest payments, which also raises the risk of failing to meet those obligations. The times interest ratio, which indicates the company’s capacity to pay interest, declined 0.2% sequentially to 5.9%.
Image Source: Zacks Investment Research
Competitive Landscape: Quest Diagnostics faces intense competition, primarily from Labcorp, other commercial laboratories and hospitals. While pricing is an important factor in choosing a testing lab, hospital-affiliated physicians expect a high level of service, including an accurate and rapid turnaround of testing results. As a result, Quest Diagnostics and other commercial labs compete with hospital-affiliated labs primarily based on the quality of service.
DGX Stock Estimate Trend
The Zacks Consensus Estimate for 2025 earnings per share (EPS) has risen 2 cents to $9.79 in the past 30 days.
The consensus estimate for the company’s 2025 revenues is pegged at $10.97 billion, which suggests 11.1% growth from the year-ago reported number.
Key Picks
Some better-ranked stocks from the broader medical space are Intuitive Surgical (ISRG - Free Report) , Medpace Holdings (MEDP - Free Report) and Boston Scientific (BSX - Free Report) .
Intuitive Surgical, carrying a Zacks Rank #1 (Strong Buy) at present, posted a third-quarter 2025 adjusted EPS of $2.40, which exceeded the Zacks Consensus Estimate by 20.6%. You can see the complete list of today’s Zacks #1 Rank stocks here.
Revenues of $2.51 billion topped the Zacks Consensus Estimate by 3.9%.
ISRG has an estimated long-term earnings growth rate of 15.7% compared with the industry’s 11.9% growth. The company’s earnings outpaced estimates in each of the trailing four quarters, the average surprise being 16.34%.
Medpace, currently carrying a Zacks Rank #2 (Buy), reported a third-quarter 2025 EPS of $3.86, which surpassed the Zacks Consensus Estimate by 10.29%. Revenues of $659.9 million beat the Zacks Consensus Estimate by 3.04%.
MEDP has an estimated earnings growth rate of 17.1% for 2025 compared with the industry’s 16.6% growth. The company beat on earnings in each of the trailing four quarters, the average surprise being 14.28%.
Boston Scientific, currently carrying a Zacks Rank #2, reported a third-quarter 2025 adjusted EPS of 75 cents, which surpassed the Zacks Consensus Estimate by 5.6%. Revenues of $5.07 billion outperformed the Zacks Consensus Estimate by 1.9%.
BSX has an estimated long-term earnings growth rate of 16.4% compared with the industry’s 13.5% growth. The company’s earnings beat estimates in each of the trailing four quarters, the average surprise being 7.36%.