Labcorp (LH): Evaluating the Stock’s Value After Launching a Groundbreaking Alzheimer’s Blood Test

Labcorp Holdings just made headlines with the rollout of the FDA-cleared Lumipulse pTau-217/Beta Amyloid 42 Ratio test, the first blood-based diagnostic of its kind to aid Alzheimer’s disease diagnosis. This isn’t just another product launch. For investors, the move addresses a real need in the market by offering a more affordable, accessible, and less invasive alternative to lumbar punctures and PET scans. With updated clinical guidelines now supporting blood-based biomarkers, Labcorp’s broad national access could resonate with patients and specialty providers alike.

Zooming out, the stock has not sat still. Labcorp has climbed 22% over the past year, and momentum has picked up through the past few months. This latest product introduction follows a series of strategic moves, such as the Covance acquisition and ongoing investments in AI-powered test finder tools, that have kept the company in focus for growth-focused investors. The combination of strong annual revenue growth and a rising earnings outlook points toward a business that is both expanding and profitable.

The question now is whether Labcorp’s recent run is just the start, or if the current share price already reflects this future growth potential.

Most Popular Narrative: 5% Undervalued

According to community narrative, Labcorp Holdings is considered undervalued, with analysts forecasting upside potential based on forward earnings growth, rising margins, and ongoing efficiency initiatives.

The introduction of innovative tests in oncology, women's health, autoimmune disease, and neurology is anticipated to capture more test volume and outpace growth in the broader market, positively impacting revenue and earnings.

How does this narrative support that price target? Much of the explanation centers on aggressive margin expansion and a profit trajectory that is uncommon in this sector. The detailed analysis shows bold analyst predictions and higher multiples, which may surprise even seasoned investors. Interested in understanding which financial levers are at play? Explore the narrative for a complete look at the reasoning behind the fair value assessment.

Result: Fair Value of $293.24 (UNDERVALUED)

Have a read of the narrative in full and understand what's behind the forecasts.

However, shifting regulations or ongoing changes in global economic conditions could quickly challenge the positive narrative around Labcorp’s future growth prospects.

Find out about the key risks to this Labcorp Holdings narrative.

Another View: What Do the Cash Flows Say?

While most focus on analyst estimates and market multiples, our DCF model paints a different picture. Based on forecasted cash flows and not just profits, this method suggests Labcorp is notably undervalued. Could this scenario actually occur?

Look into how the SWS DCF model arrives at its fair value.

Simply Wall St performs a discounted cash flow (DCF) on every stock in the world every day (check out Labcorp Holdings for example). We show the entire calculation in full. You can track the result in your watchlist or portfolio and be alerted when this changes, or use our stock screener to discover undervalued stocks based on their cash flows. If you save a screener we even alert you when new companies match - so you never miss a potential opportunity.

Build Your Own Labcorp Holdings Narrative

If you want to challenge these conclusions or simply take a hands-on approach, you can build your own view of the data in just a few minutes by using do it your way.

A great starting point for your Labcorp Holdings research is our analysis highlighting 3 key rewards and 2 important warning signs that could impact your investment decision.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

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