Guardant Health (NASDAQ:GH): Strongest Q3 Results from the Testing & Diagnostics Services Group

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Earnings results often indicate what direction a company will take in the months ahead. With Q3 behind us, let’s have a look at Guardant Health and its peers.

The testing and diagnostics services industry plays a crucial role in disease detection, monitoring, and prevention, serving hospitals, clinics, and individual consumers. This sector benefits from stable demand, driven by an aging population, increased prevalence of chronic diseases, and growing awareness of preventive healthcare. Recurring revenue streams come from routine screenings, lab tests, and diagnostic imaging, with reimbursement from Medicare, Medicaid, private insurance, and out-of-pocket payments. However, the industry faces challenges such as pricing pressures, regulatory compliance, and the need for continuous investment in new testing technologies.Looking ahead, industry tailwinds include the expansion of personalized medicine, increased adoption of at-home and rapid diagnostic tests, and advancements in AI-driven diagnostics that enhance accuracy and efficiency. However, headwinds such as reimbursement uncertainties, competition from decentralized testing solutions, and regulatory scrutiny over test validity and cost-effectiveness may impact profitability. Adapting to evolving healthcare models and integrating automation will be key for sustaining growth and maintaining operational efficiency.

The 5 testing & diagnostics services stocks we track reported a very strong Q3. As a group, revenues beat analysts’ consensus estimates by 4.9%.

Luckily, testing & diagnostics services stocks have performed well with share prices up 12.5% on average since the latest earnings results.

Best Q3: Guardant Health

Pioneering the field of "liquid biopsy" with technology that can identify cancer-specific genetic mutations from a simple blood draw, Guardant Health develops blood tests that detect and monitor cancer by analyzing tumor DNA in the bloodstream, helping doctors make treatment decisions without invasive biopsies.

Guardant Health reported revenues of $265.2 million, up 38.5% year on year. This print exceeded analysts’ expectations by 12.6%. Overall, it was an incredible quarter for the company with an impressive beat of analysts’ revenue estimates and full-year revenue guidance exceeding analysts’ expectations.

“This was an exceptional quarter for Guardant with broad-based growth across our business,” said Helmy Eltoukhy, co-founder and co-CEO.

Guardant Health pulled off the biggest analyst estimates beat and fastest revenue growth of the whole group. Unsurprisingly, the stock is up 50.2% since reporting and currently trades at $108.55.

We think Guardant Health is a good business, but is it a buy today? Read our full report here, it’s free.

RadNet

With over 350 imaging facilities across seven states and a growing artificial intelligence division, RadNet operates a network of outpatient diagnostic imaging centers across the United States, offering services like MRI, CT scans, PET scans, mammography, and X-rays.

RadNet reported revenues of $522.9 million, up 13.4% year on year, outperforming analysts’ expectations by 6.3%. The business had a strong quarter with a solid beat of analysts’ same-store sales estimates and an impressive beat of analysts’ revenue estimates.

Although it had a fine quarter compared its peers, the market seems unhappy with the results as the stock is down 6.5% since reporting. It currently trades at $73.20.

Weakest Q3: Labcorp

With over 600 million tests performed annually and involvement in 90% of FDA-approved drugs in 2023, Labcorp provides laboratory testing services and drug development solutions to doctors, hospitals, pharmaceutical companies, and patients worldwide.

Labcorp reported revenues of $3.56 billion, up 8.6% year on year, in line with analysts’ expectations. It was a mixed quarter as it posted a narrow beat of analysts’ organic revenue estimates.

Labcorp delivered the weakest performance against analyst estimates and slowest revenue growth in the group. As expected, the stock is down 4.9% since the results and currently trades at $262.02.

Read our full analysis of Labcorp’s results here.

Quest

Processing approximately one-third of the adult U.S. population's lab tests annually, Quest Diagnostics provides laboratory testing and diagnostic information services to patients, physicians, hospitals, and other healthcare providers across the United States.

Quest reported revenues of $2.82 billion, up 13.2% year on year. This result topped analysts’ expectations by 3.3%. It was a strong quarter as it also logged an impressive beat of analysts’ revenue estimates and full-year revenue guidance slightly topping analysts’ expectations.

Quest pulled off the highest full-year guidance raise among its peers. The stock is down 1.9% since reporting and currently trades at $186.81.

Read our full, actionable report on Quest here, it’s free.

NeoGenomics

Operating a network of CAP-accredited and CLIA-certified laboratories across the United States and United Kingdom, NeoGenomics provides specialized cancer diagnostic testing services, including genetic analysis, molecular testing, and pathology consultation for oncologists and healthcare providers.

NeoGenomics reported revenues of $187.8 million, up 11.9% year on year. This number beat analysts’ expectations by 2.1%. Overall, it was a strong quarter as it also recorded EPS in line with analysts’ estimates and a solid beat of analysts’ revenue estimates.

NeoGenomics had the weakest full-year guidance update among its peers. The stock is up 25.6% since reporting and currently trades at $13.19.

Read our full, actionable report on NeoGenomics here, it’s free.

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Clinical Labs Hope to Head Off Looming Medicare Cuts — Barrons.com

Dow Jones Newswires

By Bill Alpert

U.S. House representatives heard the clinical lab industry plead yesterday for a reprieve from looming cuts as large as 15% in what Medicare pays Labcorp Holdings, Quest Diagnostics and cancer-testing specialists like Guardant Health, Exact Sciences, and Natera.

Starting February, a current law will require labs to tell Medicare the rates that private insurers paid for tests back in 2019. Medicare will then cut its own test payments to those levels in 2027.

That will hurt the development of technologies like the genomic tests now used for diagnosing cancer patients and sick infants, said American Clinical Laboratory Association President Susan Van Meter, at a Thursday hearing on Medicare reimbursement rates.

"Sustained cuts of such a large magnitude threaten patient access to lifesaving diagnostics and reduce investment in the next generation of clinical diagnostics," Van Meter told the Health Subcommittee of the House Energy & Commerce Committee.

The February deadline exists because of a law passed 10 years ago that made clinical labs the only healthcare industry whose Medicare rates would match those paid by private insurers. Commercial rates were first surveyed in 2016 and Medicare cut its test payments by up to 10% in each year from 2018 to 2020. The resulting $4 billion in cuts was four times what Congress had projected.

After labs and hospitals complained that Medicare's rates were based on a tiny, unrepresentative sample of the private market, Congress froze Medicare lab rates in 2020. Every year since, the freeze has been extended. The latest extension ends Jan. 31.

A bipartisan group of representatives and senators is pushing a new bill called the Results Act that would extend Medicare's rate freeze until 2028. Beginning in 2029, Medicare test rates would be based on a widely used independent database of commercial payments.

"While today's hearing is an early step towards passing the Results Act, we were encouraged by the bipartisan support during the hearing," wrote Guggenheim analyst Subbu Nambi in a Thursday note.

The most likely way the Results Act will get passed, said Nambi, will be as an attachment to a larger piece of healthcare legislation or a reconciliation bill at the end of the month.

Write to Bill Alpert at william.alpert@barrons.com

This content was created by Barron's, which is operated by Dow Jones & Co. Barron's is published independently from Dow Jones Newswires and The Wall Street Journal.

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Guardant Health Is Maintained at Buy by Canaccord Genuity

Dow Jones Newswires

Guardant Health

-5.02%

(13:00 GMT) Guardant Health Price Target Raised to $125.00/Share From $100.00 by Canaccord Genuity

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Why Is RadNet (RDNT) Stock Rocketing Higher Today

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RadNet

-0.90%

What Happened?

Shares of diagnostic imaging company RadNet jumped 5.2% in the afternoon session after Raymond James maintained its 'Strong Buy' rating on the stock and kept its price target at $95.00.

The analyst's decision signaled continued confidence in the company's prospects. This endorsement likely reassured investors, as the $95 price target suggested a notable potential upside from its trading price of $71.24 at the time of the report.

What Is The Market Telling Us

RadNet’s shares are somewhat volatile and have had 13 moves greater than 5% over the last year. In that context, today’s move indicates the market considers this news meaningful but not something that would fundamentally change its perception of the business.

The previous big move we wrote about was 3 days ago when the stock dropped 4% on the news that short-seller Hunterbrook Capital released a critical report questioning the medical imaging company's artificial intelligence (AI) business and growth metrics.

The report claimed that RadNet's AI division, a key driver of investor enthusiasm, accounted for less than 5% of the company's revenue. Hunterbrook's analysis also challenged RadNet's reported "same-center" revenue growth, suggesting that about half of this growth resulted from closing centers near surviving locations and shifting patients, rather than organic expansion. This method, according to the report, lowered the real growth to an estimated 2.5%-3%, well below the reported 6%-10%. Additionally, the short-seller raised concerns about the company's accounting practices, noting that its adjusted margins excluded costs like stock-based compensation and some research and development spending.

RadNet is up 8.4% since the beginning of the year, but at $76.02 per share, it is still trading 10% below its 52-week high of $84.48 from November 2025. Investors who bought $1,000 worth of RadNet’s shares 5 years ago would now be looking at an investment worth $4,239.

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Q3 Earnings Roundup: Cardinal Health (NYSE:CAH) And The Rest Of The Healthcare Providers & Services Segment

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Guardant Health

-5.02%

Brookdale Senior Living

Looking back on healthcare providers & services stocks’ Q3 earnings, we examine this quarter’s best and worst performers, including Cardinal Health and its peers.

The healthcare providers and services sector, from insurers to hospitals, benefits from consistent demand, generating stable revenue through premiums and patient services. However, it faces challenges from high operational and labor costs, reimbursement pressures that squeeze margins, and regulatory uncertainty. Looking ahead, an aging population with more chronic diseases and a shift toward value-based care create tailwinds. Digitization via telehealth, data analytics, and personalized medicine offers new revenue streams. Nonetheless, headwinds persist, including clinical labor shortages, ongoing reimbursement cuts, and regulatory scrutiny over pricing and quality.

The 40 healthcare providers & services stocks we track reported a strong Q3. As a group, revenues beat analysts’ consensus estimates by 2.3% while next quarter’s revenue guidance was 0.6% below.

In light of this news, share prices of the companies have held steady as they are up 1.8% on average since the latest earnings results.

Cardinal Health

Operating as a critical link in the healthcare supply chain since 1979, Cardinal Health distributes pharmaceuticals and manufactures medical products for hospitals, pharmacies, and healthcare providers across the global healthcare supply chain.

Cardinal Health reported revenues of $64.01 billion, up 22.4% year on year. This print exceeded analysts’ expectations by 7.8%. Overall, it was an exceptional quarter for the company with a solid beat of analysts’ revenue estimates and a beat of analysts’ EPS estimates.

"We are pleased with our strong broad-based operational and financial performance to begin fiscal 2026," said Jason Hollar, CEO of Cardinal Health.

Interestingly, the stock is up 20.7% since reporting and currently trades at $198.49.

We think Cardinal Health is a good business, but is it a buy today? Read our full report here, it’s free for active Edge members.

Best Q3: Guardant Health

Guardant Health reported revenues of $265.2 million, up 38.5% year on year, outperforming analysts’ expectations by 12.6%. The business had an incredible quarter with an impressive beat of analysts’ revenue estimates and full-year revenue guidance exceeding analysts’ expectations.

Guardant Health scored the biggest analyst estimates beat among its peers. The market seems happy with the results as the stock is up 33.8% since reporting. It currently trades at $96.69.

Slowest Q3: Brookdale

With a network of over 650 communities serving approximately 59,000 residents across 41 states, Brookdale Senior Living operates senior living communities across the United States, offering independent living, assisted living, memory care, and continuing care retirement communities.

Brookdale reported revenues of $813.2 million, up 3.7% year on year, falling short of analysts’ expectations by 1.7%. It was a softer quarter as it posted a significant miss of analysts’ EPS estimates and a miss of analysts’ revenue estimates.

Interestingly, the stock is up 15.9% since the results and currently trades at $10.56.

Read our full analysis of Brookdale’s results here.

Pediatrix Medical Group

With a network of approximately 2,620 affiliated physicians caring for some of the most vulnerable patients, Pediatrix Medical Group provides specialized physician services focused on neonatal, maternal-fetal, pediatric cardiology and other pediatric subspecialty care across 37 states.

Pediatrix Medical Group reported revenues of $492.9 million, down 3.6% year on year. This result surpassed analysts’ expectations by 3.2%. Overall, it was a stunning quarter as it also produced an impressive beat of analysts’ same-store sales estimates and a beat of analysts’ EPS estimates.

The stock is up 32.9% since reporting and currently trades at $22.56.

Read our full, actionable report on Pediatrix Medical Group here, it’s free for active Edge members.

UnitedHealth

With over 100 million people served across its various businesses and a workforce of more than 400,000, UnitedHealth Group operates a health insurance business and Optum, a healthcare services division that provides everything from pharmacy benefits to primary care.

UnitedHealth reported revenues of $113.2 billion, up 12.2% year on year. This print met analysts’ expectations. Taking a step back, it was a mixed quarter as it also logged a narrow beat of analysts’ customer base estimates but revenue in line with analysts’ estimates.

The company kept the number of customers flat at a total of 54.08 million. The stock is down 9.6% since reporting and currently trades at $330.25.

Read our full, actionable report on UnitedHealth here, it’s free for active Edge members.

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Guardant Health Is Maintained at Outperform by Mizuho

Dow Jones Newswires

Guardant Health

-5.02%

(13:10 GMT) Guardant Health Price Target Raised to $120.00/Share From $100.00 by Mizuho

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RadNet (RDNT) Stock Trades Down, Here Is Why

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RadNet

-0.90%

What Happened?

Shares of diagnostic imaging company RadNet fell 4% in the afternoon session after short-seller Hunterbrook Capital released a critical report questioning the medical imaging company's artificial intelligence (AI) business and growth metrics.

Additionally, the short-seller raised concerns about the company's accounting practices, noting that its adjusted margins excluded costs like stock-based compensation and some research and development spending.

The shares closed the day at $71.24, down 1.9% from previous close.

The stock market overreacts to news, and big price drops can present good opportunities to buy high-quality stocks. Is now the time to buy RadNet? Access our full analysis report here.

What Is The Market Telling Us

RadNet’s shares are somewhat volatile and have had 14 moves greater than 5% over the last year. In that context, today’s move indicates the market considers this news meaningful but not something that would fundamentally change its perception of the business.

The previous big move we wrote about was 11 days ago when the stock dropped 2.9% on the news that the company filed a prospectus supplement to register the potential resale of up to 73,567 shares of its common stock by certain selling stockholders.

The filing with the Securities and Exchange Commission was made under a shelf registration statement, which a company maintains for flexibility. News of existing shareholders registering to sell their shares often worries the market. This is because it could increase the supply of stock available for purchase, which can put downward pressure on the price. Investors also sometimes interpret such sales as a potential lack of confidence from those with intimate knowledge of the company.

RadNet is up 1.5% since the beginning of the year, but at $71.24 per share, it is still trading 15.7% below its 52-week high of $84.48 from November 2025. Investors who bought $1,000 worth of RadNet’s shares 5 years ago would now be looking at an investment worth $3,846.

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