Why Quest Diagnostics Stock Climbed This Past Week
Key Points
Partnerships with other healthcare leaders are accelerating Quest's growth.
AI is making the health insights provider more profitable.
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Shares of Quest Diagnostics (NYSE: DGX) rose more than 8% last week after the medical testing leader boosted its full-year sales and profit forecast.
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Healthy Q2 results
Quest's revenue jumped 10% year over year to $3 billion in the second quarter.
This growth was driven in part by the Quest's partnerships with Corewell Health, a non-profit healthcare system in Michigan, and Fresenius Medical Care, a leading provider of kidney dialysis and related services.
The healthcare giant also saw solid gains in its Questhealth.com direct-to-consumer business, as well as its wellness and wearables-related sales.
At the same time, Quest's investments in automation technology and artificial intelligence (AI) are making its labs more efficient. That's helping to boost its profit margins.
All told, Quest's adjusted earnings leaped 19% to $3.12 per share.
Healthier living trends bode well for Quest's long-term growth
These robust results prompted Quest to lift its full-year financial outlook. Management now projects revenue of roughly $12 billion and adjusted earnings per share of $11.05 to $11.25.
With a vast lab network that serves half the physicians and hospitals in the U.S., Quest plays a vital role in providing potentially life-saving health insights to millions of people every year.
With more people becoming more health-conscious, demand for Quest's medical testing services is set to climb in the years ahead.
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Joe Tenebruso has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Quest Diagnostics. The Motley Fool has a disclosure policy.
