Quest Diagnostics Downgraded to Neutral at Citi
2022.04.04 23:46
By Sam Boughedda
Investing.com — Quest Diagnostics Incorporated (NYSE:DGX) closed 1.3% lower Monday after Citi analyst Ralph Giacobbe downgraded the stock to neutral from buy.
The analyst pointed to several reasons for the downgrade.
“We are downgrading DGX to Neutral due primarily to concerns around the margin outlook in 2022 and 2023 on the heels of higher internal investments, heightened labor pressures, and potential for reimbursement cuts as the COVID PHE (Public Health Emergency) gradually rolls off along with concurrent volume declines,” Giacobbe said in a note to clients.
He added that the firm “believe it will take more than a year for the internal investments in Advanced Diagnostics and the buildout of the direct-to-consumer (DTC) platform to increase base business sales meaningfully as DGX transitions to a COVID-endemic world.”
Giacobbe set a price target of $175, up from $140 on the shares, which closed Monday’s session at $134.54.
