It was reported on October 30, that Karthik Kuppusamy, SVP at Quest Diagnostics DGX executed a significant insider sell, according to an SEC filing.

What Happened: Kuppusamy’s recent move involves selling 1,775 shares of Quest Diagnostics. This information is documented in a Form 4 filing with the U.S. Securities and Exchange Commission on Wednesday. The total value is $278,525.

Quest Diagnostics‘s shares are actively trading at $155.52, experiencing a down of 0.28% during Thursday’s morning session.

Delving into Quest Diagnostics’s Background

Quest Diagnostics is a leading independent provider of diagnostic testing, information, and services in the us. The company generates over 95% of its revenue through clinical testing, anatomic pathology, esoteric testing, and substance abuse testing with specimens collected at its national network of roughly 2,300 patient service centers, as well as multiple doctors offices and hospitals. The firm also runs a much smaller diagnostic solutions segment that provides clinical trials testing, risk-assessment services, and information technology solutions.

Quest Diagnostics: Delving into Financials

Revenue Growth: Quest Diagnostics’s remarkable performance in 3 months is evident. As of 30 September, 2024, the company achieved an impressive revenue growth rate of 8.41%. This signifies a substantial increase in the company’s top-line earnings. When compared to others in the Health Care sector, the company faces challenges, achieving a growth rate lower than the average among peers.

Key Profitability Indicators:

• Gross Margin: The company excels with a remarkable gross margin of 32.6%, indicating superior cost efficiency and profitability compared to its industry peers.

• Earnings per Share (EPS): The company excels with an EPS that surpasses the industry average. With a current EPS of 2.01, Quest Diagnostics showcases strong earnings per share.

Debt Management: With a below-average debt-to-equity ratio of 1.02, Quest Diagnostics adopts a prudent financial strategy, indicating a balanced approach to debt management.

Valuation Analysis:

• Price to Earnings (P/E) Ratio: The Price to Earnings ratio of 20.96 is lower than the industry average, indicating potential undervaluation for the stock.

• Price to Sales (P/S) Ratio: With a lower-than-average P/S ratio of 1.82, the stock presents an attractive valuation, potentially signaling a buying opportunity for investors interested in sales performance.

• EV/EBITDA Analysis (Enterprise Value to its Earnings Before Interest, Taxes, Depreciation & Amortization): The company’s EV/EBITDA ratio of 13.26 trails industry averages, indicating a potential disparity in market valuation that could be advantageous for investors.

Market Capitalization Analysis: Above industry benchmarks, the company’s market capitalization emphasizes a noteworthy size, indicative of a strong market presence.

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Uncovering the Importance of Insider Activity

While insider transactions should not be the sole basis for making investment decisions, they can play a significant role in an investor’s decision-making process.

In legal terms, an “insider” refers to any officer, director, or beneficial owner of more than ten percent of a company’s equity securities registered under Section 12 of the Securities Exchange Act of 1934. This can include executives in the c-suite and large hedge funds. These insiders are required to let the public know of their transactions via a Form 4 filing, which must be filed within two business days of the transaction.

When a company insider makes a new purchase, that is an indication that they expect the stock to rise.

Insider sells, on the other hand, can be made for a variety of reasons, and may not necessarily mean that the seller thinks the stock will go down.

Transaction Codes Worth Your Attention

For investors, a primary focus lies on transactions occurring in the open market, as indicated in Table I of the Form 4 filing. A P in Box 3 denotes a purchase, while S signifies a sale. Transaction code C signals the conversion of an option, and transaction code A denotes a grant, award, or other acquisition of securities from the company.

Check Out The Full List Of Quest Diagnostics’s Insider Trades.

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This article was generated by Benzinga’s automated content engine and reviewed by an editor.