We recently published a list of the 12 Best Diagnostics Stocks to Invest In Right Now. In this article, we are going to take a look at where IDEXX Laboratories, Inc. (NASDAQ:IDXX) stands against the other best diagnostics stocks to invest in right now.

Overview of the Clinical Diagnostics Market

According to a report by Mordor Intelligence, the clinical diagnostics market has a size of $88.79 billion as of 2025. It is expected to grow at a compound annual growth rate (CAGR) of 5.48% between 2025 and 2030, reaching $115.94 billion at the end of the forecast period. While North America is the largest market in the domain at present, Asia-Pacific takes the lead as the fastest growing.

As per Grand View Research, the growth in the global clinical diagnostics industry is attributed to the rising demand for lab automation and the development of specialized tests for disease management and early disease detection. In addition, the growing use of point-of-care diagnostics products has also driven a decentralization trend in the healthcare industry.

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AI in Diagnostics Healthcare: Is A New Trend Emerging?

One of the primary trends emerging in the sector is the growing use of artificial intelligence. AI-powered diagnostic tools are revolutionizing the interpretation of medical images with high accuracy, leading to increased adoption. These tools not only improve disease diagnostics but also allow medical professionals to develop more effective and personalized treatment plans, elevating the overall healthcare experience.

On February 24, GlobeNewswire reported that the US AI diagnostics market was worth around $655 million in 2024, as per estimates by Precedence Statistics. It is expected to grow at a CAGR of 20.7% between 2025 and 2034, reaching $4.29 billion by the end of the forecast period.

On February 4, Eric Lefkofsky, founder and CEO of Tempus AI, appeared on CNBC to talk about the impact of generative AI in diagnostics healthcare, among other things. He was of the view that generative AI and large language models aren’t more impactful in any other avenue as much as they are in healthcare. Diagnostics sit at the center of healthcare, as almost every other major decision a doctor makes is undertaken after ordering some kind of laboratory test. If we can make diagnostics more intelligent, it would be possible to route patients to the best possible and most optimal therapy.

Generative AI is thus allowing access to new tools that help structure and make sense of disparate information and use that information, whether it be physician progress notes, pathology reports, molecular data, CAT scans, MRIs, or others, to make sure that the patients are on the optimal therapy path. He further said that the promise of this technology is twofold: it is enormous in helping patients live better and longer lives while reducing the substantial waste in the US healthcare system. Generative AI is thus significantly impactful in healthcare diagnostics.

Our Methodology

We sifted through stock screeners, financial media reports, and ETFs to compile a list of 20 diagnostics and research stocks. We then selected the top 12 with the highest number of hedge fund holders, as of Q4 2024, and ranked them in ascending order. We sourced the hedge fund sentiment data from Insider Monkey’s database.

Why are we interested in the stocks that hedge funds pile into? The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 373.4% since May 2014, beating its benchmark by 218 percentage points (see more details here).

A veterinarian in a veterinary clinic examining a companion animal.

IDEXX Laboratories, Inc. (NASDAQ:IDXX)

Number of Hedge Fund Holders: 58

IDEXX Laboratories, Inc. (NASDAQ:IDXX) develops, manufactures, and distributes products and services for the livestock and poultry, animal veterinary, dairy, and water testing markets. It operates through the following segments: Companion Animal Group (CAG), Water Quality Products (Water), Livestock, Poultry, and Dairy (LPD), and Other.

The company’s revenue for fiscal Q4 2024 surpassed estimates of $935 million, reaching $954 million. EPS came in at $2.62, exceeding the anticipated $2.40. Its CAG diagnostics segment registered a 6% growth, driving the overall positive earnings performance.

IDEXX Laboratories, Inc. (NASDAQ:IDXX) is focusing on innovation, recently introducing the inVue Dx™ Cellular Analyzer to streamline veterinary workflows. It is continually expanding its diagnostics portfolio, supported by R&D investments and the anticipated launch of a canine lymphoma diagnostic tool. The company’s growth strategy is based on attaining success in international markets and emphasizing high-margin consumables.

Its 2025 guidance reflects optimism, as management anticipates a sales growth of 4% to 7%. EPS is expected to jump between 10% and 15%. IDEXX Laboratories, Inc. (NASDAQ:IDXX) also has considerable expansion opportunities, as North America currently drives 65% of its revenue, while Asia-Pacific and Europe represent untapped potential. On March 18, Mark Massaro from BTIG reiterated a buy rating for the company with a price target of $530.00. It ranks fifth on our list of the 12 best diagnostics stocks to buy now.

Conestoga Capital Advisors stated the following regarding IDEXX Laboratories, Inc. (NASDAQ:IDXX) in its Q4 2024 investor letter:

“IDEXX Laboratories, Inc. (NASDAQ:IDXX) is the industry leader in providing instruments (and consumables) used in diagnostics, detection, and information systems for veterinary, food, and water testing applications. Earnings for the quarter were mixed, and forward guidance was lowered. Shares were pressured as clinical visits across the industry remain weak, with an unprecedented 10 of 11 recent quarters seeing negative US same-store vet visits. These recent trends should normalize over time as the secular demand remains robust.”

Overall, IDXX ranks 5th on our list of the best diagnostics stocks to invest in right now. While we acknowledge the potential of IDXX as an investment, our conviction lies in the belief that AI stocks hold greater promise for delivering higher returns and doing so within a shorter time frame. If you are looking for an AI stock that is more promising than IDXX but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.

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Disclosure: None. This article is originally published at Insider Monkey.