Quest Diagnostics, Inc. (DGX)

pnouri (99.05) Submitted: 2/15/08 12:59 PM : Start Price: $50.72 DGX Score: -4.92

Look out below for the stock price of this diagnostic lab. There are many internal problems here, but their worst problem is the business they continue to lose to competitors due to contract shakeups. If you must be in this space, get in LH at 70. Smaller labs will continue to take business from DGX over time. The company will need to announce some sort of restructuring for lower sales before they can grow earnings again. Keeping your eye on the ball here, when the initial CEO left in 2003 or so, the stock topped out. I think its a lesson to investors to find out why executives depart, its often for more reasons than needing to spend more time with family.

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