Quest Diagnostics Incorporated (NYSE:DGX) Yearly Results: Here's What Analysts Are Forecasting For This Year

Investors in Quest Diagnostics Incorporated (NYSE:DGX) had a good week, as its shares rose 5.0% to close at US$163 following the release of its full-year results. Results were roughly in line with estimates, with revenues of US$9.9b and statutory earnings per share of US$7.69. This is an important time for investors, as they can track a company's performance in its report, look at what experts are forecasting for next year, and see if there has been any change to expectations for the business. We've gathered the most recent statutory forecasts to see whether the analysts have changed their earnings models, following these results.

View our latest analysis for Quest Diagnostics

After the latest results, the 16 analysts covering Quest Diagnostics are now predicting revenues of US$10.8b in 2025. If met, this would reflect a solid 9.3% improvement in revenue compared to the last 12 months. Per-share earnings are expected to climb 11% to US$8.69. In the lead-up to this report, the analysts had been modelling revenues of US$10.7b and earnings per share (EPS) of US$8.65 in 2025. So it's pretty clear that, although the analysts have updated their estimates, there's been no major change in expectations for the business following the latest results.

The analysts reconfirmed their price target of US$175, showing that the business is executing well and in line with expectations. The consensus price target is just an average of individual analyst targets, so - it could be handy to see how wide the range of underlying estimates is. The most optimistic Quest Diagnostics analyst has a price target of US$190 per share, while the most pessimistic values it at US$154. The narrow spread of estimates could suggest that the business' future is relatively easy to value, or thatthe analysts have a strong view on its prospects.

These estimates are interesting, but it can be useful to paint some more broad strokes when seeing how forecasts compare, both to the Quest Diagnostics' past performance and to peers in the same industry. It's clear from the latest estimates that Quest Diagnostics' rate of growth is expected to accelerate meaningfully, with the forecast 9.3% annualised revenue growth to the end of 2025 noticeably faster than its historical growth of 2.2% p.a. over the past five years. By contrast, our data suggests that other companies (with analyst coverage) in a similar industry are forecast to grow their revenue at 7.0% per year. It seems obvious that, while the growth outlook is brighter than the recent past, the analysts also expect Quest Diagnostics to grow faster than the wider industry.

The Bottom Line

The most obvious conclusion is that there's been no major change in the business' prospects in recent times, with the analysts holding their earnings forecasts steady, in line with previous estimates. Fortunately, they also reconfirmed their revenue numbers, suggesting that it's tracking in line with expectations. Additionally, our data suggests that revenue is expected to grow faster than the wider industry. There was no real change to the consensus price target, suggesting that the intrinsic value of the business has not undergone any major changes with the latest estimates.

Following on from that line of thought, we think that the long-term prospects of the business are much more relevant than next year's earnings. We have estimates - from multiple Quest Diagnostics analysts - going out to 2027, and you can see them free on our platform here.

However, before you get too enthused, we've discovered 1 warning sign for Quest Diagnostics that you should be aware of.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.