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Sep 30, 2020
Quest Diagnostics Q3 2020 Earnings Report
Quest Diagnostics had a strong third quarter, benefiting from continued demand for COVID-19 testing and the rapid recovery of health care utilization.
Key Takeaways
Quest Diagnostics reported a strong third quarter, driven by continued demand for COVID-19 testing and a rapid recovery in healthcare utilization. Revenues increased by 42.5% compared to the previous year, with significant growth in diagnostic information services. The company also raised its outlook for the full year 2020.
Third quarter revenues increased by 42.5% year-over-year, reaching $2.79 billion.
Reported EPS increased by 164.6% to $4.14, and adjusted EPS increased by 144.9% to $4.31.
Cash provided by operations increased by 189.0% to $862 million.
The company will return $138 million in CARES Act funding.
Forward Guidance
The company updated its Full Year 2020 outlook with increased expectations for net revenues, reported diluted EPS, adjusted diluted EPS, and cash provided by operations.
Positive Outlook
- Net revenues are expected to be between $8.8 billion and $9.1 billion.
- Net revenues increase between 13.9% and 17.8%.
- Reported diluted EPS is projected to be between $8.22 and $9.22.
- Adjusted diluted EPS is expected to be between $9.00 and $10.00.
- Cash provided by operations is anticipated to be at least $1.75 billion.
Challenges Ahead
- Capital expenditures are expected to be approximately $400 million.
- Impacts of the COVID-19 pandemic and measures taken in response.
- Adverse results from pending or future government investigations, lawsuits or private actions.
- The complexity of billing, reimbursement and revenue recognition for clinical laboratory testing.
Historical Earnings Impact
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Avg. Return Before/After Earnings
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