UPDATE: Oppenheimer Initiates Quest Diagnostics at Underperform on Restructuring, Industry Risks
Oppenheimer initiated coverage on Quest Diagnostics (NYSE: DGX) with an Underperform rating and a $53.00 price target.
Oppenheimer noted, "While management is taking steps to streamline the company's operations, we believe the industry's headwinds will overshadow progress in the near term. Although a 4.95% reimbursement cut is on the table, if sequestration is averted, we think the industry may have to absorb an even greater pricing decline in a grand bargain scenario. We estimate that, even with the company's proposed cost reductions, reimbursement headwinds will still dominate. With volume growth trailing the industry and cost cutting a multi-year process, we believe the shares of DGX will trail its primary competitor."
Quest Diagnostics closed at $57.94 on Monday.
Latest Ratings for DGX
|Feb 2015||Bank of America||Downgrades||Neutral||Underperform|
|Jan 2015||Wells Fargo||Downgrades||Market Perform||Underperform|
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