Quest Diagnostics (DGX) Down 4.2% Since Last Earnings Report: Can It Rebound?

A month has gone by since the last earnings report for Quest Diagnostics (DGX). Shares have lost about 4.2% in that time frame, underperforming the S&P 500.Will the recent negative trend continue leading up to its next earnings release, or is Quest Diagnostics due for a breakout? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at its most recent earnings report in order to get a better handle on the important drivers.Quest Diagnostics' Q4 Earnings & Revenues Beat EstimatesQuest Diagnostics Inc.’s (DGX) fourth-quarter 2025 adjusted earnings per share (EPS) of $2.42 beat the Zacks Consensus Estimate by 2.85%. The metric also exceeded the year-ago adjusted figure by 8.5%.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 were $2.18 per share, up 11.8% from last year’s figure.For 2025, the company reported an adjusted EPS of $9.85, up 10.3% from the year-ago levels. The figure surpassed the Zacks Consensus Estimate by 0.5%.DGX’s Revenues in DetailRevenues reported in the fourth quarter rose 7.1% year over year to $2.81 billion. The metric surpassed the Zacks Consensus Estimate by 2.08%.Diagnostic Information Services revenues in the quarter were up 7.3% on a year-over-year basis to $2.74 billion.Volumes (measured by the number of requisitions) were up 8.5% year over year in the fourth quarter. Revenue per requisition dropped 0.1% year over year.For full-year 2025, the company’s revenues were $11.04 billion, reflecting an 11.8% increase from the year-ago level. The figure beat the Zacks Consensus Estimate by 1%.DGX shares have gained nearly 2% in pre-market trading following the earnings report.DGX’s Q4 Margin PerformanceThe cost of services during the reported quarter was $1.90 billion, up 7.5% year over year. The gross profit was $910 million, rising 6.1% year over year. The gross margin decreased 30 basis points (bps) to 32.4%.SG&A expenses totaled $504 million in the quarter under review, up 8.2% from the fourth quarter of 2024. The adjusted operating margin of 14.5% represented a 49 bps contraction year over year.DGX’s Financial PositionQuest Diagnostics exited the fourth quarter of 2025 with cash and cash equivalents of $420 million compared with $549 million at the end of 2024.The cumulative net cash provided by operating activities at the end of the fourth quarter of 2025 was $1.89 billion compared with $1.33 billion at the end of 2024.The company has a five-year annualized dividend growth rate of 6.88%.DGX’s 2026 GuidanceQuest Diagnostics provided its full-year 2026 outlook. Revenues are expected to be in the range of $11.70-$11.82 billion, which indicates a year-over-year increase of 6-7.1%. The Zacks Consensus Estimate is pegged at $11.35 billion.Adjusted EPS is expected to be in the band of $10.50-$10.70. The Zacks Consensus Estimate for the metric is pegged at $10.45.How Have Estimates Been Moving Since Then?In the past month, investors have witnessed a upward trend in estimates revision.VGM ScoresCurrently, Quest Diagnostics has a nice Growth Score of B, however its Momentum Score is doing a bit better with an A. Charting a somewhat similar path, the stock has a grade of B on the value side, putting it in the top 40% for value investors.Overall, the stock has an aggregate VGM Score of A. If you aren't focused on one strategy, this score is the one you should be interested in.OutlookEstimates have been broadly trending upward for the stock, and the magnitude of these revisions looks promising. Notably, Quest Diagnostics has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.Performance of an Industry PlayerQuest Diagnostics is part of the Zacks Medical - Outpatient and Home Healthcare industry. Over the past month, DaVita HealthCare (DVA), a stock from the same industry, has gained 7.3%. The company reported its results for the quarter ended December 2025 more than a month ago.DaVita HealthCare reported revenues of $3.62 billion in the last reported quarter, representing a year-over-year change of +9.9%. EPS of $3.40 for the same period compares with $2.24 a year ago.DaVita HealthCare is expected to post earnings of $2.41 per share for the current quarter, representing a year-over-year change of +20.5%. Over the last 30 days, the Zacks Consensus Estimate remained unchanged.The overall direction and magnitude of estimate revisions translate into a Zacks Rank #2 (Buy) for DaVita HealthCare. Also, the stock has a VGM Score of A.Zacks Names #1 Semiconductor StockThis under-the-radar company specializes in semiconductor products that titans like NVIDIA don't build. It's uniquely positioned to take advantage of the next growth stage of this market. And it's just beginning to enter the spotlight, which is exactly where you want to be.With strong earnings growth and an expanding customer base, it's positioned to feed the rampant demand for Artificial Intelligence, Machine Learning, and Internet of Things. Global semiconductor manufacturing is projected to explode from $452 billion in 2021 to $971 billion by 2028.See This Stock Now for Free >>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 DaVita Inc. (DVA): 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