Quest Diagnostics (DGX) has unveiled two blood tests that can accurately identify Alzheimer's disease in symptomatic patients. This step forward is highlighted in a new Neurology Clinical Practice study. One test is already available, while another will launch next year.

Quest Diagnostics’ progress on Alzheimer’s testing comes as the company’s share price has climbed 18% year-to-date, reflecting renewed optimism in its growth story. Investors have seen a total shareholder return of just over 17% in the past year, a solid showing that suggests momentum is building as new products hit the market and healthcare innovation moves forward.

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But with the stock trading nearly 11% below analyst price targets and an intrinsic discount of 21%, investors may wonder if Quest Diagnostics still offers meaningful upside or if the company’s recent gains already reflect future growth potential.

Most Popular Narrative: 9.6% Undervalued

Quest Diagnostics’ widely followed narrative places its fair value at $197.25, well above its last close price of $178.26. This signals that market sentiment may be underestimating the company’s future earnings power and margin potential.

Ongoing growth in advanced and preventive testing, including cardiometabolic, autoimmune, brain health, oncology, and women's/reproductive diagnostics, as well as robust demand from functional medicine and wellness-focused consumers, are driving higher test volumes and increasing test-per-requisition, which supports both revenue growth and margin expansion.

Want to see what’s fueling this high-target valuation? The key lies in bold profit margin expansion and ambitious growth forecasts. The narrative’s assumptions dig deep into operational shifts and evolving healthcare demand. Curious to understand the specifics behind that gap? Find out what the numbers say about Quest Diagnostics’ future when you read the full narrative.

Result: Fair Value of $197.25 (UNDERVALUED)

However, potential reductions in Medicare reimbursements and a shifting payer mix could pressure Quest Diagnostics’ margins and act as catalysts that might alter the current outlook.

Build Your Own Quest Diagnostics Narrative

If you’re interested in digging into the details yourself or wish to challenge the consensus, you can build your own view in just a few minutes, all with Do it your way.

A great starting point for your Quest Diagnostics research is our analysis highlighting 5 key rewards and 1 important warning sign that could impact your investment decision.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.