2Q Dx Preview: GH upside, DGX/LH stability

Research evidence excerpt

2Q Dx Preview: GH upside, DGX/LH stability

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Life Sciences & Diagnostic Tools

2Q Dx Preview: GH upside, DGX/LH

stability

Price Objective Change

2Q Dx preview: Labs, Specialty Dx, and Tools biz 13 July 2026

Heading into 2Q earnings, sentiment for Labs & Specialty Dx in our coverage leans Equity

positive, and much of the group has posted strong returns in recent months. We don’t United States

expect surprises for Labs (DGX & LH) despite noises around utilization, while continue to Life Sciences & Diagnostic Tools

favor GH in Specialty Dx coverage given its strong catalyst pipelines ahead. For Dx in Michael Ryskin

Tools, 2Q results are likely to be driven by company-specific factors, and incremental Research Analyst

China risks seems limited (for now). We raise POs for LH and NEO, and lower for CAI. BofAS+1 646 855 4373

michael.ryskin@bofa.com

Labs: debates center around utilization, PAMA & ACA Lu Li

Utilization remains the key debate for DGX and LH. We think there is a dislocation ResearchBofAS Analyst

between hospital utilization and lab utilization. We haven’t seen any evidence of +1 646 855 4645 lu.li5@bofa.com

utilization loss in April/May (see XIFIN lab volume data in Exhibit 1) and believe

Avantika Dhabaria

reference labs’ national footprint and co-lab partnerships can blend out noises. On the Research Analyst

policy front, we don’t expect any surprises from PAMA and ACA disenrollment in 2Q BofAS +1 646 743 0170

print, but believe any potential impact is more likely to appear in 2H’26 / 2027. avantika.dhabaria@bofa.com

Alexa Chan

Research AnalystSpecialty Dx: is the bar getting higher? BofAS

Specialty Dx group has outperformed Tools companies since May, with a median stock +1 646 855 5636

price gain of 40% vs. 21% for Tools (Exhibit 3).