Quest Diagnostics Inc (DGX) stock analysis
Quest Diagnostics Inc (DGX) clears 5 of this site's 8 mechanical value filters, 4 of 8 Buffett-style checks and 3 of 5 Lynch-style checks. At $243.28 it trades 13.3% above this site's neutral DCF value (a margin of safety of -13.3%). Its earnings quality rates Strong and it returns +2.7% to shareholders net of dilution. Figures are as of October 23, 2026, from SEC filings and market data refreshed weekly; this is educational analysis, not investment advice.
Data as of October 23, 2026. Refreshed weekly from SEC filings and market data.
What does Quest Diagnostics do?
Quest Diagnostics runs clinical labs that test patient samples for doctors, hospitals and employers.
What stands out about Quest Diagnostics?
- The share price implies 11.1% yearly growth. At $243.28, DGX's free cash flow of $12.57 per share would have to grow 11.1% a year, fading to 2.5% by year 10, for this site's DCF (10% discount rate) to match the price. This site's baseline starts at 8%, so the price asks for more growth than the baseline. Change the assumptions.
- Misses 1 of the 8 value filters. It fails PEG Ratio < 1.5 (2.36); the other 5 pass and 2 were not evaluated. See every filter.
- Close to its 52-week high. At $243.28, DGX is within 1.7% of its high of $247.45, 40.2% above its low of $173.49. See the range.
- Weakest against peers: debt / equity. At 0.75 (peer median 0.69) it ranks 24th of 34 among health care stocks this site tracks. See the ranking.
- P/E at the top of its own range. DGX trades at 24.6× trailing earnings; at the end of each of its last 5 fiscal years the multiple was between 11.1× and 19.8×.
How has Quest Diagnostics' share price moved?
The interactive price chart needs JavaScript.
Is Quest Diagnostics undervalued? The value diligence check
Every value-investing signal this site computes for this stock, gathered in one place: the same real numbers from the tools below, not a new score.
- Margin of safety (DCF) -13.3%
- P/E vs. its own history 24.6x · at/above its priciest point Real range: 11.1x–19.8x over 5 years (net income per diluted share from each fiscal year's 10-K, paired with the real closing price at that fiscal year-end).
- Wall St. analyst rating Buy · 3.83/5 23 analysts this month: 6 strong buy, 7 buy, 10 hold, 0 sell, 0 strong sell (Finnhub).
- Altman Z″-Score (bankruptcy risk) 3.52 · Safe zone
- Earnings quality (is the profit real?) Strong · all 5 checks clean Beneish M-score −2.67 · accruals −5.5% of assets · 165% of profit arrived as cash · stock comp 0.8% of revenue · share count 0.0% a year. From the latest 10-K (year to Dec 2025) - see the Earnings Quality Screener for how each check is scored.
- Shareholder yield (cash back to owners) +2.7% net Latest fiscal year (2025): dividends 1.4% + buybacks 1.7% − stock comp 0.3%, as a share of today's market cap. Over 14 years its split-adjusted share count fell 29%. See Shareholder Yield Leaders.
- Capital needed to grow (See's test) $17.96 per $1 of new profit · Capital-hungry · but only 11% return on capital Operating profit $1.2B → $1.4B, capital needed $8.7B → $12B, 2016–2025 (3-year averages); return on capital now 11% before tax. Buffett's See's Candies needed $0.42 per $1 of new profit, FlightSafety $3.20, a typical grower about $5. See Capital-Light Compounders.
- PEG (growth at a reasonable price) 2.36 · Well above fair P/E 24.6× ÷ 10.4% a year of growth behind it. 264th lowest of 447 stocks with a usable PEG. Lynch's fair value is a PEG of 1; a very high PEG usually means almost no growth, a very low one a profit spike. See PEG Ratio Ranking.
- Compounder lenses (4) 2 of 4 · misses capital-light, price Capital-light growth: not cleared (profit grew 1.2×, under 2×); Profit is real: cleared; Cash to owners: cleared; Fair price (PEG): not cleared (PEG 2.36, over 1.5). See Compounders at a Fair Price, which also lets you move the PEG bar.
- Value trap check Clear
- Munger's Inversion Check 0 flags
- Standing vs. sector peers 2 of 7 measures above the median Compared with the 33 other health care stocks this site tracks: 0 in the top third, 1 in the bottom third.
- Dividend payout sustainability 0/6 · clean
How does Quest Diagnostics compare with its peers?
2 of 7 measures sit above the median of the 33 other health care stocks tracked here, 1 in the bottom third.
- P/E ratiolower is cheaper · peer median 24.6× 24.6× –17th of 32
- Free-cash-flow yieldhigher is cheaper · peer median 5.5% 5.2% –19th of 34
- Return on equityhigher is better · peer median 15% 14% –18th of 34
- Net marginhigher is better · peer median 9.3% 9.2% –18th of 34
- Revenue growthhigher is better, year on year · peer median 8.6% 9.9% –13th of 34
- Debt / equitylower is safer · peer median 0.69 0.75 ✕24th of 34
- Dividend yieldamong dividend payers · peer median 1.10% 1.39% –9th of 21
Peers are the stocks this site tracks in the same sector group, not every listed competitor. The bar runs from the weakest peer (left) to the strongest (right); the tick is the middle. Measures that don't apply to a sector (cash-flow yield for banks, debt for financials) are left out.
What would Buffett & Lynch say?
Buffett's checklist is built around durable, profitable businesses bought at sensible prices, and DGX doesn't clear enough of it yet. In its favor: DGX is currently earning a strong return on shareholders' equity, and has kept that profitability up over five years, not just this year, earns many times its interest expense, so debt service isn't a worry, and trades at a reasonable multiple of owner earnings, his own term for the real cash a business could pay out. Where it comes up short: DGX carries more debt relative to equity than he typically tolerates, runs thinner pretax margins than he'd like to see, hasn't grown earnings per share fast enough over five years to impress him, and is trading above what a conservative discounted-cash-flow estimate says it's worth right now.
- ROE (TTM) > 11% ✓
- ROE (5yr avg) > 11% ✓
- Debt/Equity < 0.5 ✕
- Pretax margin > 15% ✕
- EPS growth (5yr) > 7% ✕
- Interest coverage > 5x ✓
- Trading below intrinsic value (DCF) ✕
- Price vs. owner earnings < 25x ✓
- Bonus: returning capital via buybacks FY2025
Lynch looked for growth stories that weren't overpriced for that growth, and DGX falls short of his bar. In its favor: DGX is growing earnings at the steady 10-20% pace of a proper Stalwart, isn't asking investors to overpay for that growth, and is backing its growth up with real free cash flow. Where it comes up short: DGX fails his signature PEG test, he'd call this pricey for the growth on offer, and carries more debt than he liked to see, even allowing for the extra room a large, stable business gets.
- PEG < 1 ✕
- EPS growth 10%-20% ✓
- Debt/Equity < 0.6 ✕
- P/E < 27 ✓
- Price/FCF < 30 ✓
Quantitative approximations of each investor's documented approach, not endorsed by either investor or their estates - commentary, not this site's actual ranking criteria. Buffett never published a numeric checklist: only 2 of his 8 checks here trace to his own documented concepts ("owner earnings," from his 1986 shareholder letter, and "price is what you pay, value is what you get," his case against fixed P/E/P/B ceilings) - the other 6 (ROE, debt, margins, growth, interest coverage) use commonly-cited thresholds that are not numbers he himself published. The 8 hard filters below (plus the Munger check and Graham margin of safety) are this site's real, mechanical screen and are computed completely independently of the checklists above.
Berkshire Hathaway's own filing
Which of the 8 value filters does Quest Diagnostics pass?
- Market Cap > $25B $26.1B
- Trailing P/E < 25 24.58
- PEG Ratio < 1.5 2.36
- Price/Book < 8 3.47
- Price/Sales < 7 2.26
- EPS Growth YoY > -5% +14.5%
- vs 50-day MA (±12%) Not evaluated †
- vs 200-day MA (±12%) Not evaluated †
What is Quest Diagnostics' margin of safety?
History tracking starts this week - check back in a future week to see how this has moved.
Where is Quest Diagnostics in its 52-week range?
What is the short interest in Quest Diagnostics?
3,417,577 shares short as of 2026-09-30 (FINRA settlement date). Reported twice a month, so this only changes roughly every two weeks, not daily.
What could go wrong with Quest Diagnostics? Munger's inversion check
"Invert, always invert." Instead of reasons to buy, these are reasons to hesitate, not a verdict, and not everything worth knowing about a business.
- Margin of safety, even in the bull case +33%
- Short interest under 5% of float 3.1%
- Passes most of the 6 fundamental filters 5/6 passed
- Price run-up backed by value, not just momentum +40% off 52wk low
- Debt/equity stable since 2016 0.81 → 0.79
Doesn't cover circle of competence, management quality, or accounting concerns: those need judgment, not data.
How much have Quest Diagnostics shareholders gained per year?
Earnings growth per share plus dividend.
An earnings-based proxy, not a stock-price total return - it doesn't capture multiple expansion/contraction or reinvested dividends. EPS from DGX's own 10-K filings; dividend yield is the current trailing yield on today's price, from the same weekly fetch as the rest of this site.
What do Quest Diagnostics' 10-year financials show?
From DGX's own 10-K filings (SEC EDGAR): up to the last 10 fiscal years. Press any year's bars for the exact figures.
Frequently asked questions about Quest Diagnostics
What kind of company is Quest Diagnostics?
Quest Diagnostics runs clinical labs that test patient samples for doctors, hospitals and employers. This site groups it with Health Care stocks.
Is Quest Diagnostics trading above or below its DCF value?
At $243.28, DGX trades 13.3% above this site's neutral DCF value of $214.66 per share, a margin of safety of −13.3%. That DCF projects free cash flow for 10 years, with growth starting at 8% and fading to 2.5%, discounted at 10%; it is one set of assumptions, not a forecast. Test your own in the Intrinsic Value Calculator.
How many of this site's 8 value filters does Quest Diagnostics pass?
DGX passes 5 of 8. It passes Market Cap > $25B ($26.1B), Trailing P/E < 25 (24.58), Price/Book < 8 (3.47), Price/Sales < 7 (2.26) and EPS Growth YoY > -5% (+14.5%). It misses PEG Ratio < 1.5 (2.36). vs 50-day MA (±12%) and vs 200-day MA (±12%) were not evaluated, because the moving-average checks only run on stocks that clear the fundamentals first. The 8-filter list shows every stock that passes all of them.
What growth is Quest Diagnostics' share price pricing in?
At $243.28, DGX's free cash flow of $12.57 per share would have to grow 11.1% a year, fading to 2.5% by year 10, for this site's DCF (10% discount rate) to match the price. This site's baseline starts at 8%, so the price asks for more growth than the baseline. Change the assumptions.
Where is Quest Diagnostics trading compared with its 52-week range?
At $243.28, DGX trades 40.2% above its 52-week low of $173.49 and 1.7% below its 52-week high of $247.45.
Is Quest Diagnostics's P/E ratio high or low compared with its own history?
DGX trades at 24.6× trailing earnings. At the end of each of its last 5 fiscal years its P/E was between 11.1× and 19.8× (average 17.6×), so today's multiple is at or above the highest of those years. Each year's P/E pairs net income per diluted share from the 10-K with the closing price at that fiscal year-end.
Where do these numbers come from?
- Financial statements: Quest Diagnostics's 10-K annual report for the year ended Dec 31, 2025, filed Feb 26, 2026 (filing index). Every earlier year in the 10-year financials comes from the company's older 10-K filings, all listed on SEC EDGAR.
- Prices and market data: quotes, P/E and analyst ratings from Finnhub; daily price history and the 52-week range from Twelve Data, both refreshed weekly. Short interest comes from FINRA, reported twice a month.
- How to check a figure: click any number in the card above to see its exact source, and read the Editorial Standards for every rule behind the checks.
About this Quest Diagnostics Inc analysis
This page shows every value-investing check the site runs on Quest Diagnostics Inc (DGX) in one place: the 8 mechanical filters, the Buffett and Lynch checklists, a margin of safety from a disclosed DCF, earnings quality, shareholder yield and how it ranks against its sector peers. The numbers come from SEC filings and public market data, refreshed weekly, and the same rules apply to every stock on the stock list. See Editorial Standards for the sources and the rules, or run your own filters in the stock screener.