DGX
Quest Diagnostics Incorporated
$230.97
Stable Earnings Power
80%
P/Adj-EPS × Normalized Multiple
Strong
·
Conviction
Overvalued
Trading 76.0% above fair value
You pay
$230.97
Bear
$105.00
Fair
$131.25
Bull
$157.50
Bear
$105.00
-54.5%
$8.75 × 12x P/E
Fair
$131.25
-43.2%
$8.75 × 15x P/E
Bull
$157.50
-31.8%
$8.75 × 18x P/E
Adjust Assumptions
15.0x
8.75$
Key Value Driver
Normalized P/E multiple (15x base case)
Implied Market Multiple
26.4x
Analyst Consensus (External Reference)
Never blended into the bear/base/bull estimates above.
Average Target (34 analysts)
$250.00
Divergence from AlphaVal
48%
Summary
Applying a 15x P/E to adjusted EPS of $8.75, the base-case value is $131.25 per share. DDM cross-check: $121.04.
Warnings
Wall Street's average price target is $250.00 (from 34 analysts). Our estimate is 48% below the consensus -- consider that gap carefully.
Key Risks
- Growth DCF inappropriate — terminal value assumptions dominate
- EV/EBITDA misleading for regulated businesses where capex is mandated
- Regulatory risk is a fat tail not visible in normal multiples