Quest Diagnostics Stock Up on Q3 Earnings & Revenue Beat, Margins Rise

Quest Diagnostics Inc.’s DGX third-quarter 2025 adjusted earnings per share (EPS) of $2.60 beat the Zacks Consensus Estimate by 3.59%. The metric also exceeded the year-ago adjusted figure by 13%.Certain one-time expenses, like the ones related to amortization expenses, certain restructuring and integration charges, other expenses and excess tax benefits associated with stock-based compensations, were excluded from the quarter’s adjusted figures. GAAP earnings came in at $2.16 per share, up 8.5% from last year’s comparable figure.DGX’s Q3 Revenues in DetailRevenues reported in the third quarter rose 15.2% year over year to $2.82 billion. The metric surpassed the Zacks Consensus Estimate by 3.45%.Diagnostic Information Services revenues in the quarter were up 13.5% on a year-over-year basis to $2.76 billion. This figure surpassed our model’s projection of $2.64 billion for the third quarter.Quest Diagnostics Incorporated Price, Consensus and EPS Surprise Quest Diagnostics Incorporated price-consensus-eps-surprise-chart | Quest Diagnostics Incorporated QuoteVolumes (measured by the number of requisitions) were up 12.5% year over year in the third quarter. Revenue per requisition increased 0.8% year over year.DGX shares have gained nearly 4.5% in pre-market trading following the earnings report.DGX’s Q3 Margin PerformanceThe cost of services during the reported quarter was $1.87 billion, up 11.3% year over year. The gross profit came in at $949 million, rising 17% year over year. The gross margin was 33.7%, up 110 basis points (bps).SG&A expenses were $501 million in the quarter under review, increasing 11.8% from the third quarter of 2024. The adjusted operating margin of 15.9% represented a 132-bps expansion year over year.DGX’s Financial PositionQuest Diagnostics exited the third quarter of 2025 with cash and cash equivalents of $432 million compared with $319 million at the end of the second quarter.The cumulative net cash provided by operating activities at the end of the third quarter of 2025 was $1.42 billion compared with $858 million at the end of the same period last year.The company has a five-year annualized dividend growth rate of 7.21%.DGX’s 2025 GuidanceQuest Diagnostics updated its full-year 2025 outlook. Revenues are expected in the range of $10.96 billion-$11.00 billion (previously $10.80-$10.92 billion), which indicates a year-over-year increase of 11%-11.4%. The Zacks Consensus Estimate is pegged at $10.85 billion.Adjusted EPS is expected in the range of $9.76-$9.84 (earlier $9.63-$9.83). The Zacks Consensus Estimate for the metric is pegged at $9.74.Our View on DGX StockQuest Diagnostics ended the third quarter of 2025 with both earnings and revenues beating estimates. Both metrics increased on a year-over-year basis, highlighting strong demand for the company’s clinical solutions and solid execution of strategy. The expansion of both margins is highly encouraging. Based on the strength of its year-to-date performance, it raised the outlook for the full year.The quarter marked several highlights, including an agreement with Corewell Health to establish a lab services joint venture in Michigan and the completion of the acquisition of select dialysis testing assets from Fresenius Medical Care. Quest Diagnostics also secured FDA breakthrough device designation for the Haystack MRD test and formed collaborations with Mass General Brigham and Rutgers Cancer Institute to trial Haystack MRD in guiding postoperative therapy decisions.DGX’s Zacks Rank & Key PicksQuest Diagnostics currently has a Zacks Rank #3 (Hold).Some better-ranked stocks from the broader medical space are Phibro Animal Health PAHC, Veracyte VCYT and Insulet PODD.Phibro Animal Health reported a fourth-quarter fiscal 2025 EPS of 57 cents, which beat the Zacks Consensus Estimate by 9.62%. Net sales of $378.7 million topped the consensus estimate by 4.86%. PAHC currently sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.Phibro has an estimated earnings growth rate of 21.1% in fiscal 2026 compared with the industry’s 12.8%. The company’s earnings surpassed estimates in each of the trailing four quarters, the average being 27.88%.Veracyte, sporting a Zacks Rank #1, reported second-quarter 2025 adjusted EPS of 44 cents, which beat the Zacks Consensus Estimate by 41.9%. Revenues of $130.2 million topped the Zacks Consensus Estimate by 7.1%. VCYT has an estimated earnings growth rate of 19.3% for 2025 compared with the industry’s 12.9%. The company surpassed earnings estimates in each of the trailing four quarters, the average being 242.77%.Insulet, sporting a Zacks Rank #1, reported a second-quarter 2025 adjusted EPS of $1.17, which outperformed the Zacks Consensus Estimate by 25.81%. Revenues of $649.1 million exceeded the Zacks Consensus Estimate by 5.46%.PODD has an estimated earnings growth rate of 42.3% for 2025 compared with the industry’s 12.7%. The company surpassed earnings estimates in each of the trailing four quarters, the average being 19.54%.5 Stocks Set to DoubleEach was handpicked by a Zacks expert as the favorite stock to gain +100% or more in the months ahead. They includeStock #1: A Disruptive Force with Notable Growth and ResilienceStock #2: Bullish Signs Signaling to Buy the DipStock #3: One of the Most Compelling Investments in the MarketStock #4: Leader In a Red-Hot Industry Poised for GrowthStock #5: Modern Omni-Channel Platform Coiled to SpringMost of the stocks in this report are flying under Wall Street radar, which provides a great opportunity to get in on the ground floor. While not all picks can be winners, previous recommendations have soared +171%, +209% and +232%.Download Atomic Opportunity: Nuclear Energy's Comeback free today.Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Quest Diagnostics Incorporated (DGX): Free Stock Analysis Report Insulet Corporation (PODD): Free Stock Analysis Report Phibro Animal Health Corporation (PAHC): Free Stock Analysis Report Veracyte, Inc. (VCYT): Free Stock Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).Zacks Investment ResearchWeiter zum vollständigen Artikel bei Zacks Weiter zum vollständigen Artikel bei Zacks