Quest Diagnostics Incorporated (DGX) vs Waters Corporation (WAT)

Quest Diagnostics Incorporated and Waters Corporation are both Diagnostics & Research companies. Waters Corporation is the larger, with a market value of $42.3B against $26.2B — 1.6× the size. Quest Diagnostics Incorporated trades at the lower P/E: 24.8× against 108×. Waters Corporation grew revenue faster over the last twelve months: 52.5% against 9.87%. Quest Diagnostics Incorporated has the higher net margin (9.15% vs 3.59%) and the higher return on invested capital (7.94% vs 1.05%). Across the 22 metrics below, Quest Diagnostics Incorporated leads on 14 and Waters Corporation on 8.

Valuation

Metric DGX WAT Diagnostics & Research median
P/E 24.77 107.97 33.95
P/S 2.27 9.18 4.87
P/B 3.35 2.81 3.12
Price to free cash flow 19.45 116.27 34.02
EV/EBITDA 14.14 49.82 25.20
EV/Sales 2.70 10.11 5.66
Earnings yield 4.04% 0.93% (1.75%)
Free cash flow yield 5.14% 0.86% (0.13%)

Profitability

Metric DGX WAT Diagnostics & Research median
Gross margin 33.11% 50.89% 50.89%
Operating margin 14.10% 7.10% (8.57%)
Net margin 9.15% 3.59% (6.37%)
Free cash flow margin 11.67% 7.89% 0.00%
Return on equity 14.03% 1.92% (2.92%)
Return on assets 6.43% 1.13% (6.71%)
Return on invested capital 7.94% 1.05% 0.00%

Growth

Metric DGX WAT Diagnostics & Research median
Revenue growth (TTM) 9.87% 52.47% 7.69%
EPS growth (last fiscal year) 13.78% 0.47% —
Revenue growth, 5-year CAGR 3.18% 6.00% 7.40%
Net income growth, 5-year CAGR (7.06%) 4.26% 0.00%

Health

Metric DGX WAT Diagnostics & Research median
Debt to equity 0.72 0.32 0.11
Current ratio 1.59 1.86 2.02
Net debt to EBITDA 2.47 0.36 0.78

Dividend

Metric DGX WAT Diagnostics & Research median
Dividend yield 2.30% — 0.70%
Payout ratio 0.29 0.00 0.00

Size

Metric DGX WAT Diagnostics & Research median
Market cap 26.19b 42.28b 2.56b

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