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LH

Laboratory Corporation of America Holdings NYSE:LH Stock Report

Last Price

US$242.56

Market Cap

US$22.5b

7D

7.2%

1Y

-9.2%

Updated

26 Jun, 2022

Data

Company Financials +
LH fundamental analysis
Snowflake Score
Valuation5/6
Future Growth0/6
Past Performance2/6
Financial Health5/6
Dividends1/6

LH Stock Overview

Laboratory Corporation of America Holdings operates as an independent clinical laboratory company worldwide.

Laboratory Corporation of America Holdings Competitors

 

 

 

 

 

 

 

 

 

 

 

 

Price History & Performance

Summary of all time highs, changes and price drops for Laboratory Corporation of America Holdings
Historical stock prices
Current Share PriceUS$242.56
52 Week HighUS$317.17
52 Week LowUS$212.40
Beta1.04
1 Month Change-5.94%
3 Month Change-12.25%
1 Year Change-9.24%
3 Year Change40.29%
5 Year Change57.36%
Change since IPO646.34%

Recent News & Updates

Jun 05

Laboratory Corp: 15% Reward Asymmetry Under-Reflected, Seeking Exit At $280 Per Share

Laboratory Corporation of America's defensible cash production separates it from peers in the current macro-climate. Shares have traded down in recent times, and we feel the company's bottom line fundamentals are under-appreciated by the market. We are seeking a return objective of 15% or roughly $37 per share with a potential exit at $279–$289. Here, we cover the quantamental factors in LH's investment debate.

May 16
Returns On Capital Are Showing Encouraging Signs At Laboratory Corporation of America Holdings (NYSE:LH)

Returns On Capital Are Showing Encouraging Signs At Laboratory Corporation of America Holdings (NYSE:LH)

If we want to find a stock that could multiply over the long term, what are the underlying trends we should look for...

Shareholder Returns

LHUS HealthcareUS Market
7D7.2%7.8%6.6%
1Y-9.2%2.5%-18.4%

Return vs Industry: LH underperformed the US Healthcare industry which returned 2.4% over the past year.

Return vs Market: LH exceeded the US Market which returned -18.4% over the past year.

Price Volatility

Is LH's price volatile compared to industry and market?
LH volatility
LH Average Weekly Movement4.7%
Healthcare Industry Average Movement9.5%
Market Average Movement8.1%
10% most volatile stocks in US Market16.6%
10% least volatile stocks in US Market3.2%

Stable Share Price: LH is less volatile than 75% of US stocks over the past 3 months, typically moving +/- 5% a week.

Volatility Over Time: LH's weekly volatility (5%) has been stable over the past year.

About the Company

FoundedEmployeesCEOWebsite
197171,725Adam Schechterhttps://www.labcorp.com

Laboratory Corporation of America Holdings operates as an independent clinical laboratory company worldwide. It operates in two segments, Labcorp Diagnostics (Dx) and Labcorp Drug Development (DD). It offers various tests, such as blood chemistry analyses, urinalyses, blood cell counts, thyroid tests, Pap tests, hemoglobin A1C and vitamin D products, prostate-specific antigens, tests for sexually transmitted diseases, hepatitis C tests, microbiology cultures and procedures, and alcohol and other substance-abuse tests.

Laboratory Corporation of America Holdings Fundamentals Summary

How do Laboratory Corporation of America Holdings's earnings and revenue compare to its market cap?
LH fundamental statistics
Market CapUS$22.49b
Earnings (TTM)US$2.10b
Revenue (TTM)US$15.86b

10.7x

P/E Ratio

1.4x

P/S Ratio

Earnings & Revenue

Key profitability statistics from the latest earnings report
LH income statement (TTM)
RevenueUS$15.86b
Cost of RevenueUS$10.60b
Gross ProfitUS$5.26b
Other ExpensesUS$3.16b
EarningsUS$2.10b

Last Reported Earnings

Mar 31, 2022

Next Earnings Date

n/a

Earnings per share (EPS)22.65
Gross Margin33.16%
Net Profit Margin13.24%
Debt/Equity Ratio50.4%

How did LH perform over the long term?

See historical performance and comparison

Dividends

1.2%

Current Dividend Yield

n/a

Payout Ratio
We’ve recently updated our valuation analysis.

Valuation

Is LH undervalued compared to its fair value, analyst forecasts and its price relative to the market?

Valuation Score

5/6

Valuation Score 5/6

  • Price-To-Earnings vs Peers

  • Price-To-Earnings vs Industry

  • Price-To-Earnings vs Fair Ratio

  • Below Fair Value

  • Significantly Below Fair Value

  • PEG Ratio

Key Valuation Metric

Which metric is best to use when looking at relative valuation for LH?

Other financial metrics that can be useful for relative valuation.

LH key valuation metrics and ratios. From Price to Earnings, Price to Sales and Price to Book to Price to Earnings Growth Ratio, Enterprise Value and EBITDA.
Key Statistics
Enterprise Value/Revenue1.7x
Enterprise Value/EBITDA7.5x
PEG Ratio-6.5x

Price to Earnings Ratio vs Peers

How does LH's PE Ratio compare to its peers?

LH PE Ratio vs Peers
The above table shows the PE ratio for LH vs its peers. Here we also display the market cap and forecasted growth for additional consideration.
CompanyPEEstimated GrowthMarket Cap
Peer Average16.8x

Price-To-Earnings vs Peers: LH is good value based on its Price-To-Earnings Ratio (10.7x) compared to the peer average (16.8x).


Price to Earnings Ratio vs Industry

How does LH's PE Ratio compare vs other companies in the US Healthcare Industry?

Price-To-Earnings vs Industry: LH is good value based on its Price-To-Earnings Ratio (10.7x) compared to the US Healthcare industry average (18.7x)


Price to Earnings Ratio vs Fair Ratio

What is LH's PE Ratio compared to its Fair PE Ratio? This is the expected PE Ratio taking into account the company's forecast earnings growth, profit margins and other risk factors.

LH PE Ratio vs Fair Ratio.
Fair Ratio
Current PE Ratio10.7x
Fair PE Ratio23.2x

Price-To-Earnings vs Fair Ratio: LH is good value based on its Price-To-Earnings Ratio (10.7x) compared to the estimated Fair Price-To-Earnings Ratio (23.2x).


Share Price vs Fair Value

What is the Fair Price of LH when looking at its future cash flows? For this estimate we use a Discounted Cash Flow model.

Below Fair Value: LH ($242.56) is trading below our estimate of fair value ($557.64)

Significantly Below Fair Value: LH is trading below fair value by more than 20%.


Price to Earnings Growth Ratio

PEG Ratio: LH's earnings are forecast to decline next year, so we can't calculate its PEG ratio.


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Future Growth

How is Laboratory Corporation of America Holdings forecast to perform in the next 1 to 3 years based on estimates from 13 analysts?

Future Growth Score

0/6

Future Growth Score 0/6

  • Earnings vs Savings Rate

  • Earnings vs Market

  • High Growth Earnings

  • Revenue vs Market

  • High Growth Revenue

  • Future ROE


-1.6%

Forecasted annual earnings growth

Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: LH's earnings are forecast to decline over the next 3 years (-1.6% per year).

Earnings vs Market: LH's earnings are forecast to decline over the next 3 years (-1.6% per year).

High Growth Earnings: LH's earnings are forecast to decline over the next 3 years.

Revenue vs Market: LH's revenue (3% per year) is forecast to grow slower than the US market (8.4% per year).

High Growth Revenue: LH's revenue (3% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: LH's Return on Equity is forecast to be low in 3 years time (14.7%).


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Past Performance

How has Laboratory Corporation of America Holdings performed over the past 5 years?

Past Performance Score

2/6

Past Performance Score 2/6

  • Quality Earnings

  • Growing Profit Margin

  • Earnings Trend

  • Accelerating Growth

  • Earnings vs Industry

  • High ROE


24.4%

Historical annual earnings growth

Earnings and Revenue History

Quality Earnings: LH has high quality earnings.

Growing Profit Margin: LH's current net profit margins (13.2%) are lower than last year (17.3%).


Past Earnings Growth Analysis

Earnings Trend: LH's earnings have grown significantly by 24.4% per year over the past 5 years.

Accelerating Growth: LH's has had negative earnings growth over the past year, so it can't be compared to its 5-year average.

Earnings vs Industry: LH had negative earnings growth (-20.6%) over the past year, making it difficult to compare to the Healthcare industry average (9.8%).


Return on Equity

High ROE: LH's Return on Equity (19.6%) is considered low.


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Financial Health

How is Laboratory Corporation of America Holdings's financial position?

Financial Health Score

5/6

Financial Health Score 5/6

  • Short Term Liabilities

  • Long Term Liabilities

  • Debt Level

  • Reducing Debt

  • Debt Coverage

  • Interest Coverage

Financial Position Analysis

Short Term Liabilities: LH's short term assets ($5.2B) exceed its short term liabilities ($2.6B).

Long Term Liabilities: LH's short term assets ($5.2B) do not cover its long term liabilities ($7.3B).


Debt to Equity History and Analysis

Debt Level: LH's net debt to equity ratio (38.9%) is considered satisfactory.

Reducing Debt: LH's debt to equity ratio has reduced from 103.4% to 50.4% over the past 5 years.

Debt Coverage: LH's debt is well covered by operating cash flow (42.6%).

Interest Coverage: LH's interest payments on its debt are well covered by EBIT (15.8x coverage).


Balance Sheet


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Dividend

What is Laboratory Corporation of America Holdings's current dividend yield, its reliability and sustainability?

Dividend Score

1/6

Dividend Score 1/6

  • Notable Dividend

  • High Dividend

  • Stable Dividend

  • Growing Dividend

  • Earnings Coverage

  • Future Dividend Coverage


1.19%

Current Dividend Yield

Dividend Yield vs Market

Notable Dividend: LH's dividend (1.19%) isn’t notable compared to the bottom 25% of dividend payers in the US market (1.57%).

High Dividend: LH's dividend (1.19%) is low compared to the top 25% of dividend payers in the US market (4.24%).


Stability and Growth of Payments

Stable Dividend: Too early to tell whether LH's dividend payments have been stable as they only just started paying a dividend.

Growing Dividend: Too early to tell if LH's dividend payments are increasing as they only just started paying a dividend.


Earnings Payout to Shareholders

Earnings Coverage: Insufficient data to calculate payout ratio to determine if its dividend payments are covered by earnings.


Cash Payout to Shareholders

Cash Flow Coverage: With its low cash payout ratio (14.6%), LH's dividend payments are thoroughly covered by cash flows.


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Management

How experienced are the management team and are they aligned to shareholders interests?

4.0yrs

Average management tenure


CEO

Adam Schechter (56 yo)

2.58yrs

Tenure

US$20,551,605

Compensation

Mr. Adam H. Schechter serves as President & Chief Executive Officer at Laboratory Corporation of America Holdings since November 01, 2019 and serves as its Chairman since May 13, 2020. He served as a Speci...


CEO Compensation Analysis

Compensation vs Market: Adam's total compensation ($USD20.55M) is above average for companies of similar size in the US market ($USD13.44M).

Compensation vs Earnings: Adam's compensation has increased by more than 20% whilst company earnings have fallen more than 20% in the past year.


Leadership Team

Experienced Management: LH's management team is considered experienced (4 years average tenure).


Board Members

Experienced Board: LH's board of directors are considered experienced (8.8 years average tenure).


Ownership

Who are the major shareholders and have insiders been buying or selling?


Insider Trading Volume

Insider Buying: LH insiders have bought more shares than they have sold in the past 3 months.


Recent Insider Transactions

Ownership Breakdown

Dilution of Shares: Shareholders have not been meaningfully diluted in the past year.


Top Shareholders

Company Information

Laboratory Corporation of America Holdings's employee growth, exchange listings and data sources


Key Information

  • Name: Laboratory Corporation of America Holdings
  • Ticker: LH
  • Exchange: NYSE
  • Founded: 1971
  • Industry: Health Care Services
  • Sector: Healthcare
  • Implied Market Cap: US$22.485b
  • Shares outstanding: 92.70m
  • Website: https://www.labcorp.com

Number of Employees


Location

  • Laboratory Corporation of America Holdings
  • 531 South Spring Street
  • Burlington
  • North Carolina
  • 27215
  • United States

Listings


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2022/06/26 00:00
End of Day Share Price2022/06/24 00:00
Earnings2022/03/31
Annual Earnings2021/12/31


Unless specified all financial data is based on a yearly period but updated quarterly. This is known as Trailing Twelve Month (TTM) or Last Twelve Month (LTM) Data. Learn more here.