Quest Diagnostics Q4 Earnings Preview: What's in Store for the Stock?

Quest Diagnostics DGX is set to release its fourth-quarter 2024 results on Jan. 30 before the market opens.Find the latest EPS estimates and surprises on Zacks Earnings Calendar.The renowned diagnostics provider posted adjusted earnings per share (EPS) of $2.30 in the last reported quarter, which surpassed the Zacks Consensus Estimate by 1.77%. The company topped earnings estimates in each of the trailing four quarters, the average surprise being 3.41%.DGX’s Q4 EstimatesFor the fourth quarter of 2024, the Zacks Consensus Estimate for Quest Diagnostics’ revenues is pegged at $2.57 billion, indicating an increase of 12.4% from the year-ago reported figure.The Zacks Consensus Estimate for the company’s fourth-quarter 2024 EPS suggests a 1.9% increase to $2.19.Estimate Revision Trend Ahead of DGX’s Q4 EarningsEstimates for Quest Diagnostics’ Q4 earnings have remained constant at $2.19 in the past 60 days.Here’s a quick recap of the company’s performance leading up to this announcement.Factors Likely to Influence DGX’s Q4 PerformanceWe anticipate impressive growth in the company’s Diagnostic Information Services (“DIS”) in the fourth quarter of 2024, driven by strong performances across the core physician and hospital channels. In physician lab services, Quest Diagnostics is likely to have benefited from new customer wins and expanded business, mainly due to the increased utilization of Advanced Diagnostics services. The company’s investments in these highly specialized offerings continue to scale innovations to improve patient care and drive growth.Continuing the recent momentum, several clinical areas are likely to have delivered robust revenues in the fourth quarter. Brain health area growth may have been driven by the AD-Detect blood-based Alzheimer’s disease testing. In molecular genomics and oncology, DGX is likely to advance the broad national launch of the Haystack MRD (molecular residual disease) blood test. Women’s health revenues are likely to have been supported by strong demand for prenatal and hereditary genetic testing, as well as genital tract infections, including several STIs (sexually transmitted infections). The company may have witnessed high demand for tests that help physicians comprehensively screen for autoimmune disorders to speed diagnosis and expedite specialized care.Quest Diagnostics Incorporated Price and EPS Surprise Quest Diagnostics Incorporated price-eps-surprise | Quest Diagnostics Incorporated QuoteQuest Diagnostics’ string of acquisitions is also expected to have bolstered its performance in the to-be-reported quarter. The company completed the acquisition of select laboratory assets from OhioHealth in October 2024 and Alina Health the month before. The addition of LifeLabs may have helped the company grow in the Canadian market, which offers more favorable demographics than the United States.Quest Diagnostics’ fourth-quarter top line is also expected to have been boosted by strong Medicare Advantage volume and revenue growth, as these plans focus on directing testing to high-quality, cost-efficient options like the company. It is likely to have continued to expand into new geographies through partnerships with health plans.In Hospital lab services, the persistent staffing challenges for hospitals to fill specialized lab positions may have continued to drive robust demand for the reference testing business. The dynamic is prompting hospitals to take advantage of Quest Diagnostics’ expanding advanced diagnostics portfolio rather than building their in-house capabilities. The expansion of consumer-initiated tests on questhealth.com is likely to have generated strong revenues, along with an impressive repeat customer rate in the fourth quarter.Going by our model, the company’s DIS revenues are likely to increase 11.7% year over year in the to-be-reported quarter. Operationally, Quest Diagnostics’ strategic use of automation and AI is likely to have played a key role in improving quality, service, efficiency and the workforce experience. Recent developments, such as the launch of the highly automated laboratory in Lenexa, KS, piloting of automated specimen accessioning in the Clifton lab, and the collaboration with Hologic to incorporate their AI-driven cytology solution are expected to have favorably boosted the performance in the fourth quarter of 2024. Finally, the company’s Invigorate program is expected to have met its targeted 3% in annual cost savings.Our model projects Quest Diagnostics’ operating income and EBITDA (both on a non-GAAP basis) to improve by 20.7% and 20.1%, respectively, in the fourth quarter of 2024 compared to the last year. What Our Model Unveils for DGXPer our proven model, a stock with a Zacks Rank #1 (Strong Buy), 2 (Buy), or 3 (Hold), along with a positive Earnings ESP, has a higher chance of beating estimates, which is not the case here, as you can see.Earnings ESP: Quest Diagnostics has an Earnings ESP of 0.00%. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.Zacks Rank: The company currently carries a Zacks Rank #2.Top MedTech PicksHere are some medical stocks worth considering, as these have the right combination of elements to post an earnings beat this time:Masimo MASI has an Earnings ESP of +4.05% and a Zacks Rank #2. The company is set to release fourth-quarter 2024 results on Feb. 25. You can see the complete list of today’s Zacks #1 Rank stocks here.MASI’s earnings surpassed estimates in each of the trailing four quarters, with the average surprise being 17.10%. The Zacks Consensus Estimate for the company’s fourth-quarter EPS is expected to increase 14.4% from the year-ago quarter figure.Merit Medical Systems MMSI has an Earnings ESP of +3.03% and a Zacks Rank #2. The company is slated to release fourth-quarter 2024 results on Feb. 25.MMSI’s earnings surpassed estimates in each of the trailing four quarters, with the average surprise being 6.42%. The Zacks Consensus Estimate for Merit Medical’s fourth-quarter EPS is expected to increase by 2.47% from the year-ago quarter figure.Exelixis EXEL has an Earnings ESP of +2.99% and a Zacks Rank #2. The company is expected to release fourth-quarter fiscal 2024 results on Feb. 4.The company’s earnings surpassed estimates in three of the trailing four quarters and missed on one occasion, with the average surprise being 26.52%. The Zacks Consensus Estimate for EXEL’s fourth-quarter EPS is expected to surge 51.5% from the year-ago reported figure.7 Best Stocks for the Next 30 DaysJust released: Experts distill 7 elite stocks from the current list of 220 Zacks Rank #1 Strong Buys. They deem these tickers "Most Likely for Early Price Pops."Since 1988, the full list has beaten the market more than 2X over with an average gain of +24.1% per year. So be sure to give these hand picked 7 your immediate attention. See them now >>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 Masimo Corporation (MASI): Free Stock Analysis Report Merit Medical Systems, Inc. (MMSI): Free Stock Analysis Report Exelixis, Inc. (EXEL): Free Stock Analysis ReportTo read this article on Zacks.com click here.Zacks Investment ResearchWeiter zum vollständigen Artikel bei Zacks Weiter zum vollständigen Artikel bei Zacks