Filing Flows › Quest Diagnostics (DGX) › Takeover & LBO
Is Quest Diagnostics (DGX) a takeover target?
A leveraged buyout at today's price plus 30% ($333.22 a share) would return about 3% a year to a private-equity buyer over 5 years; the most a buyer could pay for a 20% return is $191.81 a share (−25% against today's $256.32). Historically 2.8% of companies with its figures were bought within a year (0.55× the average).
The buyout, step by step
| Entry | Amount | How |
|---|---|---|
| Offer price a share | $333.22 | today's $256.32 plus 30% |
| × shares | 112.0 million | |
| = Equity value | $37.3B | |
| + Debt refinanced | $5.5B | |
| − Cash | $797M | |
| + Other claims | $318M | preferred stock, minority interests |
| = Enterprise value | $42.4B | 18.4× EBITDA of $2.3B |
| Fees | $848M | 2% of the price |
| New debt | $12.7B | 5.5× EBITDA at 7.65% a year; the limit that binds: 5.5× EBITDA |
| Buyer's own money | $30.5B | 71% of the cost |
5 years under the buyer
| Year | Revenue | EBITDA | Interest | Free cash flow | Debt left |
|---|---|---|---|---|---|
| Year 1 | $12.8B | $2.5B | $971M | $601M | $12.1B |
| Year 2 | $13.7B | $2.7B | $925M | $742M | $11.4B |
| Year 3 | $14.4B | $2.8B | $868M | $882M | $10.5B |
| Year 4 | $15.0B | $2.9B | $801M | $1.0B | $9.5B |
| Year 5 | $15.5B | $3.0B | $723M | $1.1B | $8.3B |
The exit and the buyer's return
| Exit | Amount | |
|---|---|---|
| Exit multiple | 14.6× EBITDA | today's trading multiple, before any premium |
| Enterprise value at exit | $44.1B | |
| − Debt left | $8.3B | |
| = Buyer's equity | $35.8B | |
| Money multiple | 1.17× | on $30.5B put in |
| Buyer's yearly return (IRR) | 3.2% |
Price against return
What the buyer makes at other premiums over today's $256.32; the IRR reaches 20% at $191.81 a share.
| Premium | Price a share | Buyer's IRR |
|---|---|---|
| 10% | $281.95 | 7.7% |
| 20% | $307.58 | 5.3% |
| 30% | $333.22 | 3.2% |
| 40% | $358.85 | 1.4% |
| 50% | $384.48 | −0.3% |
The figures used
| Figure | Amount | |
|---|---|---|
| Revenue, last 12 months | $11.8B | |
| EBITDA, last 12 months | $2.3B | 19.5% of revenue |
| Depreciation and amortization | $585M | |
| Capital spending | $576M | |
| Debt | $5.5B | |
| Cash | $797M | |
| Share price | $256.32 | on Nov 6, 2026 |
Fixed rules, the same as the interactive view's starting point: the shares are bought at today's price plus 30%, the company's debt is refinanced and fees take 2%. New debt is the least of 5.5× EBITDA, 65% of the price and the amount whose interest EBITDA covers 2 times, at 7.65% a year (SOFR 3.89% plus the high-yield B spread 3.26% plus 0.5%, rates of Oct 15, 2026). Revenue grows 8.0% in the first year — the company's own rate, held between −3% and +8% — fading to 3% by year 5; the EBITDA margin, depreciation and capital spending stay at today's share of revenue; working capital takes 10% of each year's added revenue; tax is 23% of profit after interest. Every dollar of free cash flow repays debt. After 5 years the buyer sells at today's multiple of EBITDA.
What a takeover could cost
Takeovers in its sector paid a median premium of 35% over the share price before the deal (the middle half 22% to 45%), according to the 15 merger proxies and tender-offer responses on EDGAR that state a premium. At the median, Quest Diagnostics would cost about $346.03 a share, $38.8B for all its shares.
| Premium | % | Price a share | All shares |
|---|---|---|---|
| Low end (a quarter of deals paid less) | 22% | $312.71 | $35.0B |
| Median | 35% | $346.03 | $38.8B |
| High end (a quarter paid more) | 45% | $371.66 | $41.6B |
The odds, from history
Historically 2.8% of companies with its figures were bought within a year (0.55× the average). Its figures put it in decile 2 of 10 (10 = the most likely to be bought). The odds come from a model of every merger proxy, tender-offer response and going-private statement filed on EDGAR since 2011, set against each company's size, margins, debt, cash flow and growth the year before.
Quest Diagnostics' latest quarter
Quest Diagnostics, Q3 2026: revenue $3.1B (+10% year over year), operating margin 15.5%, net earnings $312M, operating cash flow $611M. The chart follows the revenue to costs, profit and cash.
Questions
Is Quest Diagnostics being acquired?
No headline, 8-K or 13D about a sale is on file in the last year.
Could private equity buy Quest Diagnostics?
A leveraged buyout at today's price plus 30% ($333.22 a share) would return about 3% a year to a private-equity buyer over 5 years; the most a buyer could pay for a 20% return is $191.81 a share (−25% against today's $256.32).
What would a takeover of Quest Diagnostics cost?
Takeovers in its sector paid a median premium of 35% over the share price before the deal (the middle half 22% to 45%), according to the 15 merger proxies and tender-offer responses on EDGAR that state a premium. At the median, Quest Diagnostics would cost about $346.03 a share, $38.8B for all its shares.
Updated Nov 8, 2026. Read automatically from SEC filings and public data; errors are possible. Not investment advice.