Based on the aggregated intelligence of 170,000-plus investors participating in Motley Fool CAPS, the Fool's free investing community, medical lab operator Quest Diagnostics (NYSE: DGX) has earned a respected four-star ranking.

With that in mind, let's take a closer look at Quest's business and see what CAPS investors are saying about the stock right now.

Quest facts

Headquarters (founded)

Madison, N.J. (1967)

Market Cap

$8.96 billion


Health care services

Trailing-12-Month Revenue

$7.39 billion


Chairman/CEO Dr. Surya Mohapatra

CFO Robert Hagemann (since 1998)

Return on Equity (average, past 3 years)



$994.2 million / $4.22 billion

Dividend Yield



Bio-Reference Labs (Nasdaq: BRLI)

Lab Corporation of America (NYSE: LH)

Sources: Capital IQ (a division of Standard & Poor's) and Motley Fool CAPS.

On CAPS, 95% of the 574 members who have rated Quest believe the stock will outperform the S&P 500 going forward. These bulls include All-Stars Staka and zycantodan, both of whom are ranked in the top 15% of our community.

Late last year , Staka listed several of Quest's positives:

- Duopoly with LabCorp gives a reasonable moat
- Demographical developments work for them
- Reasonable valuation, reasonable balance sheet
- Defensive stock which shouldn't be battered to much if the crisis comes back

In fact, Quest currently sports a cheapish forward P/E of 11.7. That represents a discount to other health care research plays such as LabCorp (13.8), Bio-Reference Labs (18.3), and Covance (NYSE: CVD) (18.5).

CAPS All-Star zycantodan elaborates on the bull case:

Clean facilities and well-integrated IT systems from the patient side -- you can schedule appointments online and find locations easily. This significantly cuts down on in-office wait time. All labeling is automated and efficient. I would assume the back-office IT is run as smoothly as the customer-facing side to allow for more efficiencies. ...With aging population need for DGX services will increase.

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