(Reuters) – Laboratory operator Quest Diagnostics beat Wall Street estimates for third-quarter profit and revenue on Tuesday, helped by robust demand for its diagnostic tests.
Demand for diagnostic checkups has grown in recent quarters as more people, especially older adults, caught up on surgeries deferred during the pandemic.
The company narrowed its 2024 adjusted profit forecast to between $8.85 and $8.95 per share from its prior view of $8.80 to $9. Analysts on average estimated an adjusted annual profit of $8.85, according to data compiled by LSEG.
Quest also expects a full-year revenue of $9.80 billion to $9.85 billion, above its previous forecast of $9.50 billion to $9.58 billion. Analysts expect an annual revenue of $9.67 billion.
The company said the updated outlook reflects the contributions from its C$1.35 billion ($976.07 million) takeover of Canada-based LifeLabs in August and the anticipated impact of Hurricane Milton.
The hurricane, which hit Florida earlier this month and killed at least 10 people, is expected to impact Quest’s fourth-quarter revenue by $15 million.
Quest has about a 100 patient service centers in the Tampa region that is exposed to Hurricane Milton, UBS analyst Kevin Caliendo pointed out in a note.
On the other hand, the company expects the LifeLabs deal to generate roughly $710 million in annual revenue.
“Given the strength of our business and revenue from acquisitions, we are well positioned to drive accelerated revenue and earnings growth in 2025,” CEO Jim Davis said.
The company’s sales rose 8.4% to $2.49 billion in the third quarter, beating estimates of $2.42 billion.
Excluding one-off items, Quest posted a profit of $2.30 per share in the quarter ended Sept. 30, above estimates of $2.26.
($1 = 1.3831 Canadian dollars)
(Reporting by Puyaan Singh in Bengaluru; Editing by Shreya Biswas)
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