The 10-second takeaway
For the quarter ended June 30 (Q2), Quest Diagnostics met expectations on revenues and missed estimates on earnings per share.
Compared to the prior-year quarter, revenue dropped. Non-GAAP earnings per share contracted. GAAP earnings per share contracted.
Margins dropped across the board.
Quest Diagnostics reported revenue of $1.82 billion. The 19 analysts polled by S&P Capital IQ looked for sales of $1.84 billion on the same basis. GAAP reported sales were the same as the prior-year quarter's.
Source: S&P Capital IQ. Quarterly periods. Dollar amounts in millions. Non-GAAP figures may vary to maintain comparability with estimates.
EPS came in at $1.06. The 22 earnings estimates compiled by S&P Capital IQ anticipated $1.09 per share. Non-GAAP EPS of $1.06 for Q2 were 9.4% lower than the prior-year quarter's $1.17 per share. GAAP EPS of $1.07 for Q2 were 3.6% lower than the prior-year quarter's $1.11 per share.
Source: S&P Capital IQ. Quarterly periods. Non-GAAP figures may vary to maintain comparability with estimates.
For the quarter, gross margin was 39.8%, 220 basis points worse than the prior-year quarter. Operating margin was 15.9%, 250 basis points worse than the prior-year quarter. Net margin was 9.1%, 20 basis points worse than the prior-year quarter. (Margins calculated in GAAP terms.)
Next quarter's average estimate for revenue is $1.85 billion. On the bottom line, the average EPS estimate is $1.20.
Next year's average estimate for revenue is $7.31 billion. The average EPS estimate is $4.35.
The stock has a four-star rating (out of five) at Motley Fool CAPS, with 556 members out of 592 rating the stock outperform, and 36 members rating it underperform. Among 195 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 184 give Quest Diagnostics a green thumbs-up, and 11 give it a red thumbs-down.
Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on Quest Diagnostics is hold, with an average price target of $60.44.
Can your portfolio provide you with enough income to last through retirement? You'll need more than Quest Diagnostics. Learn how to maximize your investment income and "Secure Your Future With 9 Rock-Solid Dividend Stocks." Click here for instant access to this free report.
- Add Quest Diagnostics to My Watchlist.
Seth Jayson had no position in any company mentioned here at the time of publication. You can view his stock holdings here. He is co-advisor of Motley Fool Hidden Gems, which provides new small-cap ideas every month, backed by a real-money portfolio. The Motley Fool recommends Quest Diagnostics. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.
More from The Motley Fool
3 Top Dividend Stocks in Gene Sequencing
Looking for dividend stocks in the gene sequencing field? Check out General Electric, Roche, and Quest Diagnostics.
IBM's Watson Is Tackling Medicine's Most Complex Problems
Some of the biggest companies in medicine are enlisting IBM to help solve medicine's toughest problems with Watson AI.
Better Buy: Exact Sciences Corporation vs. Quest Diagnostics
Does recent news for Exact Sciences make it a better buy now than this diagnostic industry heavyweight?