MeritValue

QUEST DIAGNOSTICS INC

DGXdata completeness 100%19 fiscal years on file
The thesis, from the filings

QUEST DIAGNOSTICS INC earns about 8% on invested capital, below its ~9% cost of capital, and has bought back 12% of its shares over 5 years — no moat visible in the numbers. The estimate methods put fair value between $9.63 and $86.75 a share.Whether it’s worth owning at today’s price is the last question — and yours to answer, below.

i. The business — what you’d actually own
FigureFY 2021FY 2022FY 2023FY 2024FY 2025
Revenue$10.8B1$9.88B2$9.25B3$9.87B3$11B3
Net income$2B4$946M5$854M6$871M6$992M6
Operating cash flow$2.23B7$1.72B8$1.27B9$1.33B9$1.89B9
Capital expenditure$403M10$404M11$408M12$425M12$527M12
Free cash flow (derived)$1.83B7$1.31B8$864M9$909M9$1.36B9
Total debt$8.02B13$7.96B14$9.43B15$12.4B16$11.3B16
Cash & equivalents$872M17$315M18$686M19$549M20$420M20
Diluted shares128.0M118.0M113.0M113.0M113.0M

Superscripts are receipts. Each links to the SEC filing the number came from (full list at the bottom).

ii. Your slice — ownership made literal
If you owned
shares
Net assets behind them
$634.51
your share of equity
Profit it earned you last year
$87.79
Free cash flow it threw off
$120.27
Debt you’d be carrying
$1,003.72

10 shares is a claim on $634.51 of net worth that earned you $87.79 and generated $120.27 of cash last year, against $1,003.72 of debt.

iii. Is this a good business?
Moat signal · return on invested capital
8% avg · 5y
FY21 16%FY22 8%FY23 7%FY24 4%FY25 4%

It earned about 8% on invested capital against a ~9% cost of capital — below the cost of funding. The numbers show no moat.

seeing a moat in the numbers →
Management signal · capital allocation
−12% shares · 5y

Share count is down 12% over 5 years — management has been buying back stock, quietly handing owners a bigger slice. Total debt has risen 41% over the same window.

reading capital allocation →

Signals, not verdicts — read from the filings above. Numbers don’t prove a moat; they show its footprint. You decide.

iv. What it’s worth — engine v0.1.0

The 3 estimate methods that apply put fair value between $9.63 and $86.75 a share. They rest on different assumptions, so where they diverge is the story; the Graham Number is a stricter floor, not a target.

DCF · Growth Exit 10Y
$9.63
assumptions (10)
  • riskFreeRate4.7%
  • equityRiskPremium5.0%
  • beta100.0%
  • equityWeight85.0%
  • costOfDebtSpread1.5%
  • taxRate21.0%
  • terminalGrowth2.5%
  • projectionYears10
  • fcfGrowth0.0%
  • fcfBase$909M
DCF · Growth Exit 5Y
$18.28
assumptions (10)
  • riskFreeRate4.7%
  • equityRiskPremium5.0%
  • beta100.0%
  • equityWeight85.0%
  • costOfDebtSpread1.5%
  • taxRate21.0%
  • terminalGrowth2.5%
  • projectionYears5
  • fcfGrowth0.0%
  • fcfBase$909M
Earnings Power Value
$86.75
assumptions (8)
  • riskFreeRate4.7%
  • equityRiskPremium5.0%
  • beta100.0%
  • equityWeight85.0%
  • costOfDebtSpread1.5%
  • taxRate21.0%
  • normalizedEarnings$946M
  • growthAssumed0.0%
Graham Number
$111.77
assumptions (1)
  • grahamMultiplier2250.0%

Different models answer different questions — which to trust when →

v. The price question — last, on purpose
Is today’s price fair?
See live price ↗
Type a price. The ledger answers.
Or set your own belief
FCF growth, next 5 years0.0%
Discount rate (WACC)8.93%
Terminal growth2.5%
At your growth, a share is worth $18.28
The three cases
Bear0.0%$18.28
Base0.0%$18.28
Bull5.0%$46.1

Bear/base/bull growth = 0% / filed history / history + 5pp. Type a price to see the return each case implies.

Default growth 0.0%= this company’s own filed history (median-to-median FCF CAGR, clamped 0–20%). Your adjustments are recorded anonymously. They become the “what do owners actually believe” dataset.

Sources — the receipts
  1. 10-K · period ending 2021-12-31 · accession 0001022079-24-000041 (RevenueFromContractWithCustomerExcludingAssessedTax)
  2. 10-K · period ending 2022-12-31 · accession 0001022079-25-000044 (RevenueFromContractWithCustomerExcludingAssessedTax)
  3. 10-K · period ending 2023-12-31 · accession 0001022079-26-000015 (RevenueFromContractWithCustomerExcludingAssessedTax)
  4. 10-K · period ending 2021-12-31 · accession 0001022079-24-000041 (NetIncomeLoss)
  5. 10-K · period ending 2022-12-31 · accession 0001022079-25-000044 (NetIncomeLoss)
  6. 10-K · period ending 2023-12-31 · accession 0001022079-26-000015 (NetIncomeLoss)
  7. 10-K · period ending 2021-12-31 · accession 0001022079-24-000041 (NetCashProvidedByUsedInOperatingActivities)
  8. 10-K · period ending 2022-12-31 · accession 0001022079-25-000044 (NetCashProvidedByUsedInOperatingActivities)
  9. 10-K · period ending 2023-12-31 · accession 0001022079-26-000015 (NetCashProvidedByUsedInOperatingActivities)
  10. 10-K · period ending 2021-12-31 · accession 0001022079-24-000041 (PaymentsToAcquirePropertyPlantAndEquipment)
  11. 10-K · period ending 2022-12-31 · accession 0001022079-25-000044 (PaymentsToAcquirePropertyPlantAndEquipment)
  12. 10-K · period ending 2023-12-31 · accession 0001022079-26-000015 (PaymentsToAcquirePropertyPlantAndEquipment)
  13. 10-K · period ending 2021-12-31 · accession 0001022079-23-000018 (LongTermDebtNoncurrent)
  14. 10-K · period ending 2022-12-31 · accession 0001022079-24-000041 (LongTermDebtNoncurrent)
  15. 10-K · period ending 2023-12-31 · accession 0001022079-25-000044 (LongTermDebtNoncurrent)
  16. 10-K · period ending 2024-12-31 · accession 0001022079-26-000015 (LongTermDebtNoncurrent)
  17. 10-K · period ending 2021-12-31 · accession 0001022079-23-000018 (CashAndCashEquivalentsAtCarryingValue)
  18. 10-K · period ending 2022-12-31 · accession 0001022079-24-000041 (CashAndCashEquivalentsAtCarryingValue)
  19. 10-K · period ending 2023-12-31 · accession 0001022079-25-000044 (CashAndCashEquivalentsAtCarryingValue)
  20. 10-K · period ending 2024-12-31 · accession 0001022079-26-000015 (CashAndCashEquivalentsAtCarryingValue)