With a market cap of about $15.7 billion, New Jersey-based Quest Diagnostics Incorporated (DGX) is a global leader in diagnostic testing and services. It develops and delivers a wide range of diagnostic information services, including routine, non-routine, and advanced clinical testing, as well as anatomic pathology and other specialized diagnostic services. The company is scheduled to disclose its fiscal Q2 earnings results on Tuesday, July 23. 

Ahead of this event, analysts are expecting DGX to report a profit of $2.30 per share, remaining flat year over year. However, the company has an impressive track record of surpassing Wall Street's bottom-line estimates in each of the last four quarters. The company's adjusted EPS in the last reported quarter remained flat year over year at $2.04 but managed to outshine the consensus EPS estimate by nearly 9.7%.

Looking forward to fiscal 2024, analysts project Quest Diagnostics to report EPS of $8.79, up marginally from $8.71 in fiscal 2023. Meanwhile, for fiscal 2025, EPS is expected to grow by 7.4% annually to $9.44.

Shares of Quest Diagnostics have climbed 2.2% on a YTD basis, lagging behind the broader S&P 500 Index’s ($SPX) 16.1% gains over the same period. However, zooming in further, the stock has outpaced the S&P Healthcare Services SPDR’s (XHS) marginal returns over the same time frame.

On April 23, the company revealed its Q1 earnings results, which topped Wall Street estimates on both the top and bottom lines. However, despite this better-than-expected performance, investors remained unimpressed due to the company’s marginal annual revenue growth. Consequently, shares stayed nearly flat post-announcement. 

Nevertheless, more recently, on July 3, DGX stock jumped almost 3.1% after the Ontario pension fund manager struck a deal to sell medical lab company LifeLabs to Quest Diagnostics for $1.4 billion, igniting investor enthusiasm.

Analysts' consensus rating on DGX stock is cautiously optimistic, with a "Moderate Buy" rating overall. Among 15 analysts covering the stock, four recommend a "Strong Buy," and the remaining 11 give a "Hold" rating. This configuration has remained consistent over the past three months. 

The average analyst price target for DGX is $146.21, suggesting a potential upside of only 3.8% from the current levels.

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On the date of publication, Anushka Mukherjee did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information please view the Barchart Disclosure Policy here.