Quest Diagnostics Incorporated (DGX)

FairStock Score: 53/100 — MIXED

Key Financials

AI Analysis

AI-generated, general educational analysis — not personal investment advice.

I approach Quest Diagnostics as a diagnostic-testing business with scale, 46,000 employees, and recurring demand for clinical testing. The recent record is respectable: in fiscal Q2 2026, the quarter ended 2026-06-30, revenue was $3.0B, net income $320.0M, and diluted EPS $2.84, up from $2.8B, $282.0M, and $2.47 in fiscal Q2 2025. For FY2025, filed results show revenue of $11.0B, net income of $992.0M, and diluted EPS of $8.75, against $9.9B, $871.0M, and $7.69 in FY2024. The Piotroski F-Score is 9/9, and trailing free cash flow is $1.3B, a 5.3% FCF yield. That cash generation is a genuine strength, and beta of 0.55 suggests the shares have not been especially volatile. But the price asks a lot. At the 2026-10-13 close of $230.46, the FairStock-calculated P/E is 24.49, P/B is 3.37, and PEG is 1.82. The Graham Number is only $120.28, leaving a margin of safety of -91.60%, meaning the market price is far above what Graham's formula would support. Return on equity is 14.60%, but ROCE is just 6.40%, and debt-to-equity is 0.81. FairStock classifies Quest as a SLOW GROWER, with profit shrinking 7.1% a year over five years and revenue growing 3.2%. Recent quarters are better, but the long-term record and modest return on capital argue for caution. A fine business can still be a poor investment at the wrong price.

In plain English: Quest Diagnostics does medical testing and diagnostic services in the United States. The business has grown sales and profit recently and produces plenty of cash, but it carries debt and its longer-term profit trend has been weak. At the 2026-10-13 close of $230.46 a share, the price looks high compared with the company's profits and net worth, so it does not look like a bargain based on the numbers.

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Data as of 2026-10-13 close · note generated 2026-10-15 · model deepseek-flash

Sources (SEC EDGAR): fiscal Q2 2026 10-Q (period ended 2026-06-30) · fiscal Q1 2026 10-Q (period ended 2026-03-31) · fiscal Q3 2025 10-Q (period ended 2025-09-30) · fiscal Q2 2025 10-Q (period ended 2025-06-30) · FY2025 10-K (period ended 2025-12-31) · FY2024 10-K (period ended 2024-12-31) · FY2023 10-K (period ended 2023-12-31)

Fundamentals from company filings and market-data providers; prices are end-of-day, not real-time. AI-generated analysis is general and educational — not personal investment advice. Scoring methodology · Score test · Disclaimer