QUEST DIAGNOSTICS INC (DGX) Stock Fundamental Analysis
USA - New York Stock Exchange - NYSE:DGX - US74834L1008 - Common Stock
191.25 USD
+3.64 (+1.94%)
191.25 USD
0 (0%)
We assign a fundamental rating of 5 out of 10 to DGX. DGX was compared to 100 industry peers in the Health Care Providers & Services industry. While DGX belongs to the best of the industry regarding profitability, there are some minor concerns on its financial health. DGX has a decent growth rate and is not valued too expensively. DGX also has an excellent dividend rating. These ratings would make DGX suitable for dividend investing!
1. Profitability
1.1 Basic Checks
DGX had positive earnings in the past year.
DGX had a positive operating cash flow in the past year.
DGX had positive earnings in each of the past 5 years.
In the past 5 years DGX always reported a positive cash flow from operatings.
1.2 Ratios
DGX has a better Return On Assets (5.95%) than 82.00% of its industry peers.
DGX has a better Return On Equity (13.27%) than 78.00% of its industry peers.
DGX has a Return On Invested Capital of 8.79%. This is in the better half of the industry: DGX outperforms 76.00% of its industry peers.
The Average Return On Invested Capital over the past 3 years for DGX is in line with the industry average of 9.38%.
The 3 year average ROIC (8.77%) for DGX is below the current ROIC(8.79%), indicating increased profibility in the last year.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 5.95% | ||
| ROE | 13.27% | ||
| ROIC | 8.79% |
ROA(3y)6.25%
ROA(5y)8.71%
ROE(3y)14.08%
ROE(5y)18.83%
ROIC(3y)8.77%
ROIC(5y)10.97%
1.3 Margins
The Profit Margin of DGX (8.88%) is better than 91.00% of its industry peers.
DGX's Profit Margin has declined in the last couple of years.
Looking at the Operating Margin, with a value of 14.71%, DGX belongs to the top of the industry, outperforming 88.00% of the companies in the same industry.
In the last couple of years the Operating Margin of DGX has declined.
With a decent Gross Margin value of 33.47%, DGX is doing good in the industry, outperforming 63.00% of the companies in the same industry.
In the last couple of years the Gross Margin of DGX has remained more or less at the same level.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 14.71% | ||
| PM (TTM) | 8.88% | ||
| GM | 33.47% |
OM growth 3Y-14.9%
OM growth 5Y-3.56%
PM growth 3Y-21.92%
PM growth 5Y-4.54%
GM growth 3Y-5.79%
GM growth 5Y-1.22%
2. Health
2.1 Basic Checks
With a Return on Invested Capital (ROIC) just above the Cost of Capital (WACC), DGX is creating some value.
The number of shares outstanding for DGX remains at a similar level compared to 1 year ago.
DGX has less shares outstanding than it did 5 years ago.
The debt/assets ratio for DGX is higher compared to a year ago.
2.2 Solvency
DGX has an Altman-Z score of 3.27. This indicates that DGX is financially healthy and has little risk of bankruptcy at the moment.
DGX's Altman-Z score of 3.27 is fine compared to the rest of the industry. DGX outperforms 70.00% of its industry peers.
The Debt to FCF ratio of DGX is 4.07, which is a neutral value as it means it would take DGX, 4.07 years of fcf income to pay off all of its debts.
DGX has a Debt to FCF ratio of 4.07. This is in the better half of the industry: DGX outperforms 72.00% of its industry peers.
A Debt/Equity ratio of 0.71 indicates that DGX is somewhat dependend on debt financing.
With a Debt to Equity ratio value of 0.71, DGX perfoms like the industry average, outperforming 52.00% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.71 | ||
| Debt/FCF | 4.07 | ||
| Altman-Z | 3.27 |
ROIC/WACC1.02
WACC8.63%
2.3 Liquidity
DGX has a Current Ratio of 1.13. This is a normal value and indicates that DGX is financially healthy and should not expect problems in meeting its short term obligations.
With a Current ratio value of 1.13, DGX is not doing good in the industry: 64.00% of the companies in the same industry are doing better.
DGX has a Quick Ratio of 1.04. This is a normal value and indicates that DGX is financially healthy and should not expect problems in meeting its short term obligations.
With a Quick ratio value of 1.04, DGX is not doing good in the industry: 68.00% of the companies in the same industry are doing better.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.13 | ||
| Quick Ratio | 1.04 |
3. Growth
3.1 Past
DGX shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 10.41%, which is quite good.
Measured over the past 5 years, DGX shows a small growth in Earnings Per Share. The EPS has been growing by 6.58% on average per year.
DGX shows quite a strong growth in Revenue. In the last year, the Revenue has grown by 13.74%.
The Revenue has been growing slightly by 5.02% on average over the past years.
EPS 1Y (TTM)10.41%
EPS 3Y-14.1%
EPS 5Y6.58%
EPS Q2Q%13.04%
Revenue 1Y (TTM)13.74%
Revenue growth 3Y-2.91%
Revenue growth 5Y5.02%
Sales Q2Q%13.18%
3.2 Future
Based on estimates for the next years, DGX will show a small growth in Earnings Per Share. The EPS will grow by 7.50% on average per year.
The Revenue is expected to grow by 4.83% on average over the next years.
EPS Next Y9.8%
EPS Next 2Y7.76%
EPS Next 3Y8.13%
EPS Next 5Y7.5%
Revenue Next Year11.72%
Revenue Next 2Y7.54%
Revenue Next 3Y6.29%
Revenue Next 5Y4.83%
3.3 Evolution
When comparing the EPS growth rate of the last years to the growth rate of the upcoming years, we see that the growth is stable.
The Revenue growth rate is stable: in the next years the growth will be about the same than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
Based on the Price/Earnings ratio of 19.60, the valuation of DGX can be described as rather expensive.
Based on the Price/Earnings ratio, DGX is valued a bit cheaper than 69.00% of the companies in the same industry.
When comparing the Price/Earnings ratio of DGX to the average of the S&P500 Index (25.45), we can say DGX is valued slightly cheaper.
The Price/Forward Earnings ratio is 18.26, which indicates a rather expensive current valuation of DGX.
Compared to the rest of the industry, the Price/Forward Earnings ratio of DGX indicates a somewhat cheap valuation: DGX is cheaper than 63.00% of the companies listed in the same industry.
When comparing the Price/Forward Earnings ratio of DGX to the average of the S&P500 Index (34.46), we can say DGX is valued slightly cheaper.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 19.6 | ||
| Fwd PE | 18.26 |
4.2 Price Multiples
Compared to the rest of the industry, the Enterprise Value to EBITDA ratio of DGX indicates a somewhat cheap valuation: DGX is cheaper than 65.00% of the companies listed in the same industry.
74.00% of the companies in the same industry are more expensive than DGX, based on the Price/Free Cash Flow ratio.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 15.35 | ||
| EV/EBITDA | 12.16 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates an expensive valuation of the company.
DGX has a very decent profitability rating, which may justify a higher PE ratio.
PEG (NY)2
PEG (5Y)2.98
EPS Next 2Y7.76%
EPS Next 3Y8.13%
5. Dividend
5.1 Amount
DGX has a Yearly Dividend Yield of 1.71%. Purely for dividend investing, there may be better candidates out there.
Compared to an average industry Dividend Yield of 2.57, DGX pays a better dividend. On top of this DGX pays more dividend than 88.00% of the companies listed in the same industry.
Compared to the average S&P500 Dividend Yield of 2.45, DGX is paying slightly less dividend.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.71% |
5.2 History
On average, the dividend of DGX grows each year by 6.92%, which is quite nice.
DGX has paid a dividend for at least 10 years, which is a reliable track record.
DGX has not decreased their dividend for at least 10 years, which is a reliable track record.
Dividend Growth(5Y)6.92%
Div Incr Years13
Div Non Decr Years20
5.3 Sustainability
DGX pays out 36.03% of its income as dividend. This is a sustainable payout ratio.
The dividend of DGX is growing around the same rate as the earnings are growing. If this keeps up the dividend growth is sustainable.
DP36.03%
EPS Next 2Y7.76%
EPS Next 3Y8.13%
191.25
+3.64 (+1.94%)
Chartmill FA Rating
GICS SectorHealth Care
GICS IndustryGroupHealth Care Equipment & Services
GICS IndustryHealth Care Providers & Services
Earnings (Last)
Earnings (Next)
Inst Owners99.12%
Inst Owner Change6.95%
Ins Owners0.3%
Ins Owner Change-1.69%
Market Cap21.39B
Revenue(TTM)10.85B
Net Income(TTM)963.00M
Analysts75
Price Target200.6 (4.89%)
Short Float %4.14%
Short Ratio4.62
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.71% |
Yearly Dividend2.98
Dividend Growth(5Y)6.92%
DP36.03%
Div Incr Years13
Div Non Decr Years20
Ex-Date
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)1.87%
Min EPS beat(2)0.93%
Max EPS beat(2)2.81%
EPS beat(4)4
Avg EPS beat(4)2.75%
Min EPS beat(4)0.93%
Max EPS beat(4)5.56%
EPS beat(8)7
Avg EPS beat(8)2.61%
EPS beat(12)11
Avg EPS beat(12)2.24%
EPS beat(16)15
Avg EPS beat(16)2.88%
Revenue beat(2)2
Avg Revenue beat(2)1.1%
Min Revenue beat(2)0.33%
Max Revenue beat(2)1.88%
Revenue beat(4)3
Avg Revenue beat(4)0.68%
Min Revenue beat(4)-0.15%
Max Revenue beat(4)1.88%
Revenue beat(8)6
Avg Revenue beat(8)0.83%
Revenue beat(12)10
Avg Revenue beat(12)1.39%
Revenue beat(16)13
Avg Revenue beat(16)1.59%
PT rev (1m)4.81%
PT rev (3m)5.18%
EPS NQ rev (1m)-2.41%
EPS NQ rev (3m)-2.35%
EPS NY rev (1m)0.6%
EPS NY rev (3m)1.13%
Revenue NQ rev (1m)1.24%
Revenue NQ rev (3m)1.24%
Revenue NY rev (1m)1.11%
Revenue NY rev (3m)1.34%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 19.6 | ||
| Fwd PE | 18.26 | ||
| P/S | 1.97 | ||
| P/FCF | 15.35 | ||
| P/OCF | 11.35 | ||
| P/B | 2.95 | ||
| P/tB | N/A | ||
| EV/EBITDA | 12.16 |
EPS(TTM)9.76
EY5.1%
EPS(NY)10.47
Fwd EY5.48%
FCF(TTM)12.46
FCFY6.51%
OCF(TTM)16.86
OCFY8.81%
SpS97.03
BVpS64.91
TBVpS-29.56
PEG (NY)2
PEG (5Y)2.98
Graham Number119.39
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 5.95% | ||
| ROE | 13.27% | ||
| ROCE | 11.35% | ||
| ROIC | 8.79% | ||
| ROICexc | 9.06% | ||
| ROICexgc | 40.27% | ||
| OM | 14.71% | ||
| PM (TTM) | 8.88% | ||
| GM | 33.47% | ||
| FCFM | 12.84% |
ROA(3y)6.25%
ROA(5y)8.71%
ROE(3y)14.08%
ROE(5y)18.83%
ROIC(3y)8.77%
ROIC(5y)10.97%
ROICexc(3y)9.13%
ROICexc(5y)11.7%
ROICexgc(3y)38.8%
ROICexgc(5y)46.51%
ROCE(3y)11.44%
ROCE(5y)14.33%
ROICexgc growth 3Y-18.68%
ROICexgc growth 5Y-6.38%
ROICexc growth 3Y-22.78%
ROICexc growth 5Y-5.24%
OM growth 3Y-14.9%
OM growth 5Y-3.56%
PM growth 3Y-21.92%
PM growth 5Y-4.54%
GM growth 3Y-5.79%
GM growth 5Y-1.22%
F-Score8
Asset Turnover0.67
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.71 | ||
| Debt/FCF | 4.07 | ||
| Debt/EBITDA | 2.4 | ||
| Cap/Depr | 87.86% | ||
| Cap/Sales | 4.53% | ||
| Interest Coverage | 6.09 | ||
| Cash Conversion | 87.43% | ||
| Profit Quality | 144.65% | ||
| Current Ratio | 1.13 | ||
| Quick Ratio | 1.04 | ||
| Altman-Z | 3.27 |
F-Score8
WACC8.63%
ROIC/WACC1.02
Cap/Depr(3y)90.53%
Cap/Depr(5y)97.23%
Cap/Sales(3y)4.27%
Cap/Sales(5y)4.19%
Profit Quality(3y)115.37%
Profit Quality(5y)109.91%
High Growth Momentum
Growth
EPS 1Y (TTM)10.41%
EPS 3Y-14.1%
EPS 5Y6.58%
EPS Q2Q%13.04%
EPS Next Y9.8%
EPS Next 2Y7.76%
EPS Next 3Y8.13%
EPS Next 5Y7.5%
Revenue 1Y (TTM)13.74%
Revenue growth 3Y-2.91%
Revenue growth 5Y5.02%
Sales Q2Q%13.18%
Revenue Next Year11.72%
Revenue Next 2Y7.54%
Revenue Next 3Y6.29%
Revenue Next 5Y4.83%
EBIT growth 1Y21%
EBIT growth 3Y-17.38%
EBIT growth 5Y1.28%
EBIT Next Year44.72%
EBIT Next 3Y16.78%
EBIT Next 5YN/A
FCF growth 1Y133.73%
FCF growth 3Y-20.8%
FCF growth 5Y1.52%
OCF growth 1Y74.7%
OCF growth 3Y-15.78%
OCF growth 5Y1.42%
QUEST DIAGNOSTICS INC / DGX FAQ
Can you provide the ChartMill fundamental rating for QUEST DIAGNOSTICS INC?
ChartMill assigns a fundamental rating of 5 / 10 to DGX.
What is the valuation status for DGX stock?
ChartMill assigns a valuation rating of 4 / 10 to QUEST DIAGNOSTICS INC (DGX). This can be considered as Fairly Valued.
Can you provide the profitability details for QUEST DIAGNOSTICS INC?
QUEST DIAGNOSTICS INC (DGX) has a profitability rating of 7 / 10.
What is the expected EPS growth for QUEST DIAGNOSTICS INC (DGX) stock?
The Earnings per Share (EPS) of QUEST DIAGNOSTICS INC (DGX) is expected to grow by 9.8% in the next year.
How sustainable is the dividend of QUEST DIAGNOSTICS INC (DGX) stock?
The dividend rating of QUEST DIAGNOSTICS INC (DGX) is 7 / 10 and the dividend payout ratio is 36.03%.