Morgan Stanley's Rating Changes (DGX, EM)

Morgan Stanley made the following rating changes this morning:

Quest Diagnostics (NYSE: DGX) from Underweight to Equal-weight.

Morgan Stanley writes, "We are upgrading DGX shares to Equal-weight. Our new rating reflects a more stable utilization environment as we assume volumes have largely bottomed and management's enhanced appetite towards acquisitions. Combined these two drivers are likely to provide downside support to the shares. DGX shares are trading at 13.2x our 2011 estimates and 11.9x our 2012 estimates, at an 11% discount to its closest peer, LH."

Morgan Stanley has a $60 PT on DGX.

At the time of posting, shares of DGX were trading at $57.57, up 0.37% from Friday's close.

Emdeon (NYSE: EM) from Overweight to Equal-weight.

Morgan Stanley writes, "We are downgrading Emdeon to an Equal-weight (from an Overweight) as Emdeon's current share price represents a more balanced risk-reward, in our view. We forecast same-store top-line growth of ~5% in CY 2011 reflecting the benefit of the acquisitions completed over the last 12 month and easier year-over-year comparisons as we assume utilization has largely bottomed."

Morgan Stanley maintains a $15 PT on EM.

At the time of posting, shares of EM were trading at $14.41, down 3.29% from Friday's close.