Quest Diagnostics / Labcorp: Potential -ve Read-through to Labs on Greater ACA Coverage Loss for the Year

Research evidence excerpt

Quest Diagnostics / Labcorp: Potential -ve Read-through to Labs on Greater ACA Coverage Loss for the Year

Barclays | Quest Diagnostics / Labcorp

CD: Barclays Bank PLC and/or an affiliate is a market-maker in debt securities issued by Quest Diagnostics.

CE: Barclays Bank PLC and/or an affiliate is a market-maker in equity securities issued by Quest Diagnostics.

J: Barclays Bank PLC and/or an affiliate is a liquidity provider and/or trades regularly in the securities by Quest Diagnostics and/or in any related

derivatives.

Valuation Methodology: Our $230 PT applies a ~21.5x multiple to our FY'26 EPS of $10.78.

Risks which May Impede the Achievement of the Barclays Research Valuation and Price Target: Downside risks include: (1) reimbursement risk,

namely the resumption of annual PAMA cuts, reducing pricing by ~$100M; (2) higher-than-expected turnover or wage inflation putting pressure on

DGX's cost structure; and (3) other regulatory/policy impacts that potentially create enrollment HWs.

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