Growing Through Challenges? – Quest Diagnostics Incorporated (NYSE: DGX)

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SSgA Funds Management, Inc. recently announced the acquisition of new stake in Quest Diagnostics Incorporated (NYSE:DGX). The institutional investor has increased its shareholding in the Healthcare company by 2.70% to 6.82 million shares with purchase of 0.18 million shares. This fresh investment now brings its stake to 5.10% valued currently at $777.07 million. In addition, Fiduciary Management, Inc. raised its holdings by 68125.0 to 4.66 million shares. And JPMorgan Investment Management, I. has lifted its position by 26.45% or 0.48 million shares – to 2.3 million shares.

With over 1.91 million Quest Diagnostics Incorporated (DGX) shares trading Friday and a closing price of $125.11 on the day, the dollar volume was approximately $239.21 million. The shares have shown a positive weekly performance of 7.10% and its price on 07/17/20 gained nearly 1.16%. Currently, there are 134.00M common shares owned by the public and among those 133.06M shares have been available to trade.

An analysis of what Wall Street brokers have to say about the expected price targets for this stock gives us this picture: 19 analysts who have offered their price forecasts for DGX have a consensus price objective of $130.60. The analysts have set the share’s price value over the next 12 months at a high of $155.00 and a low of $111.00 should the stock experience a downside. Incidentally, analysts’ outlook for the Quest Diagnostics Incorporated stock is 2.30 for the next 12 months. The average price target is 1.04% above its last price level and an upside to the estimated low will see the stock lose -12.71% over that period. But an upside of 19.28% will see the stock hit the forecast high price target while mean target price for the stock is $130.00.

Insiders at the company have transacted a total of 101 times over the past 12 months, according to data filed with the U.S. Securities and Exchange Commission (SEC). 37 of these insider trades were purchases, accounting for 605,214 shares. Insider sales of the common stock occurred on 64 occasions, with total insider shares sold totaling 570,811 shares.

The top 3 mutual fund holders in Quest Diagnostics Incorporated are Vanguard Total Stock Market Index, Vanguard Mid Cap Index Fund, and Victory Sycamore Established Valu. Vanguard Total Stock Market Index owns 3.82 million shares of the company’s stock, all valued at over $434.83 million. The company sold 69187.0 shares recently to bring their total holdings to about 2.85% of the shares outstanding. Vanguard Mid Cap Index Fund sold -0.21 million shares to see its total holdings shrink to 3.31 million shares valued at over $376.92 million and representing 2.47% of the shares outstanding. Victory Sycamore Established Valu now owns shares totaling to 2.17% of the shares outstanding.

Shares of Quest Diagnostics Incorporated (NYSE: DGX) opened at $123.95, up $0.27 from a prior closing price of $123.68. However, the script later closed the day at $125.11, up 1.16%. The company’s stock has a 5-day price change of 7.10% and 31.14% over the past three months. DGX shares are trading 17.16% year to date (YTD), with the 12-month market performance up to 24.03% higher. It has a 12-month low price of $73.02 and touched a high of $125.32 over the same period. Currently, 1.91 million shares have been traded, compared to an average intraday trading volume of 1.75 million shares. The stock is trading above its simple moving averages at the SMA20, SMA50, and SMA200, as the current price level is off by 9.37%, 9.88%, and 18.71% respectively.

Institutional ownership of Quest Diagnostics Incorporated (NYSE: DGX) shares accounts for 92.80% of the company’s 134.00M shares outstanding. Mutual fund holders own 39.23%, while other institutional holders and individual stakeholders account for 52.76% and 28.86% respectively.

It has a market capitalization of $16.54B and a beta (3y monthly) value of 1.37. The stock’s trailing 12-month PE ratio is 22.09, while the earnings-per-share (ttm) stands at $5.66. The company has a PEG of 2.79 and a Quick Ratio of 1.30 with the debt-to-equity ratio at 0.71. Price movements for the stock have been influenced by the stock’s volatility, which stands at 3.40% over the week and 2.93% over the month.

Analysts forecast that Quest Diagnostics Incorporated (DGX) will achieve an EPS of $0.12 for the current quarter, $2.01 for the next quarter and $7.59 for 2021. The lowest estimate earnings-per-share for the quarter is -$0.66 while analysts give the company a high EPS estimate of $0.72. Comparatively, EPS for the current quarter was $1.73 a year ago. Earnings per share for the fiscal year are expected to increase by 18.70%, and 1.74% over the next financial year. EPS should shrink at an annualized rate of 7.92% over the next five years, compared to 10.20% over the past 5-year period.

If you are looking to buy this stock, then you may note that the average analyst recommendation by 19 brokerage firm advisors rate Quest Diagnostics Incorporated (DGX) as a “Moderate Buy” at a consensus score of 2.30. Specifically, 9 Wall Street analysts polled rate the stock as a buy, while 8 of the 19 advise that investors “hold,” and 0 rated it as a “Sell.”

Looking at the support for the DGX, a number of firms have released research notes about the stock. BofA Securities stated their Buy rating for the stock in a research note on July 14, 2020, with the firm’s price target at $142. Wells Fargo coverage for the Quest Diagnostics Incorporated (DGX) stock in a research note released on June 09, 2020 offered a Equal Weight rating with a price target of $120. Deutsche Bank was of a view on June 02, 2020 that the stock is Buy, while Morgan Stanley gave the stock Overweight rating on April 28, 2020, issuing a price target of $139. Wolfe Research on their part issued Peer Perform rating on April 27, 2020.

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