Head to Head Comparison: The Pennant Group (NASDAQ:PNTG) versus Quest Diagnostics (NYSE:DGX)

Quest Diagnostics (NYSE:DGX) and The Pennant Group (NASDAQ:PNTG) are both medical companies, but which is the superior stock? We will compare the two companies based on the strength of their analyst recommendations, profitability, earnings, dividends, valuation, risk and institutional ownership.

Earnings & Valuation

This table compares Quest Diagnostics and The Pennant Group”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Quest Diagnostics	$9.87 billion	2.13	$871.00 million	$8.52	22.21
The Pennant Group	$695.24 million	1.45	$22.56 million	$0.75	38.87

Quest Diagnostics has higher revenue and earnings than The Pennant Group. Quest Diagnostics is trading at a lower price-to-earnings ratio than The Pennant Group, indicating that it is currently the more affordable of the two stocks.

Volatility and Risk

Quest Diagnostics has a beta of 0.64, indicating that its stock price is 36% less volatile than the S&P 500. Comparatively, The Pennant Group has a beta of 1.28, indicating that its stock price is 28% more volatile than the S&P 500.

Institutional and Insider Ownership

88.1% of Quest Diagnostics shares are held by institutional investors. Comparatively, 85.9% of The Pennant Group shares are held by institutional investors. 8.2% of Quest Diagnostics shares are held by company insiders. Comparatively, 5.4% of The Pennant Group shares are held by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company is poised for long-term growth.

Profitability

This table compares Quest Diagnostics and The Pennant Group’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Quest Diagnostics	8.91%	15.47%	6.84%
The Pennant Group	3.15%	9.37%	4.20%

Analyst Recommendations

This is a breakdown of current recommendations for Quest Diagnostics and The Pennant Group, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Quest Diagnostics	0	10	7	0	2.41
The Pennant Group	0	2	6	0	2.75

Quest Diagnostics currently has a consensus target price of $197.27, indicating a potential upside of 4.23%. The Pennant Group has a consensus target price of $36.20, indicating a potential upside of 24.19%. Given The Pennant Group’s stronger consensus rating and higher possible upside, analysts plainly believe The Pennant Group is more favorable than Quest Diagnostics.

Summary

Quest Diagnostics beats The Pennant Group on 10 of the 14 factors compared between the two stocks.

About Quest Diagnostics

Quest Diagnostics Incorporated provides diagnostic testing and services in the United States and internationally. The company develops and delivers diagnostic information services, such as routine, non-routine and advanced clinical testing, anatomic pathology testing, and other diagnostic information services. It offers diagnostic information services primarily under the Quest Diagnostics brand, as well as under the AmeriPath, Dermpath Diagnostics, ExamOne, and Quanum brands to physicians, hospitals, patients and consumers, health plans, government agencies, employers, retailers, pharmaceutical companies and insurers, and accountable care organizations through a network of laboratories, patient service centers, phlebotomists in physician offices, call centers and mobile phlebotomists, nurses, and other health and wellness professionals. The company also provides risk assessment services for the life insurance industry; and healthcare organizations and clinicians information technology solutions. Quest Diagnostics Incorporated was founded in 1967 and is headquartered in Secaucus, New Jersey.

About The Pennant Group

The Pennant Group, Inc. provides healthcare services in the United States. It operates in two segments, Home Health and Hospice Services, and Senior Living Services. The company offers home health services, including clinical services, such as nursing, speech, occupational and physical therapy, medical social work, and home health aide services; and hospice services comprising clinical care, education, and counseling services for the physical, spiritual, and psychosocial needs of terminally ill patients and their families. It also provides senior living services, such as residential accommodations, activities, meals, housekeeping, and assistance in the activities of daily living to seniors who are independent or who require some support. The company operates home health, hospice, and home care agencies, as well as senior living communities throughout Arizona, California, Colorado, Idaho, Montana, Nevada, Oklahoma, Oregon, Texas, Utah, Washington, Wisconsin, and Wyoming. The Pennant Group, Inc. was incorporated in 2019 and is headquartered in Eagle, Idaho.