Labcorp Holdings (LH) AI Stock Analysis

• Market Cap: $23.50B
• Dividend Yield: 1%
• Average Volume (3M): 467.33K
• Price to Earnings (P/E): 31.2
• Beta (1Y): 0.45
• Revenue Growth: 7.98%
• EPS Growth: 72.22%
• Country: US
• Employees: 60,900
• Sector: Healthcare
• Sector Strength: 45
• Industry: Medical - Equipment & Services
• EPS (TTM): 4.35
• Shares Outstanding: 83,100,000
• 10 Day Avg. Volume: 491,987
• 30 Day Avg. Volume: 467,329
• PEG Ratio: 0.30
• Price to Book (P/B): 2.39
• Price to Sales (P/S): 1.48
• P/FCF Ratio: 17.56
• Enterprise Value/Market Cap: 1.19
• Enterprise Value/Revenue: 2.07
• Enterprise Value/Gross Profit: 7.36
• Enterprise Value/Ebitda: 14.94
• 1Y Price Target: $298.33
• Price Target Upside: 6.91% Upside
• Rating Consensus: Strong Buy
• Number of Analyst Covering: 13

• Rating: 76 Outperform
• Price Target: $306.00 ▲(9.65% Upside)

Labcorp Holdings demonstrates strong financial management and positive technical indicators, contributing to a favorable outlook. The company's robust earnings call and strategic initiatives further enhance its position. However, high valuation metrics and potential regulatory risks temper the overall score.

Positive Factors

Innovative Diagnostic Tests

The introduction of the FDA-cleared Lumipulse test for Alzheimer's enhances Labcorp's portfolio, positioning it as a leader in innovative diagnostics, potentially driving long-term growth through increased adoption and market differentiation.

Revenue Growth

Consistent revenue growth, driven by both organic and acquisition strategies, indicates strong market demand and effective business execution, supporting Labcorp's long-term financial health and competitive position.

Strategic Partnerships

Strategic partnerships and acquisitions enhance Labcorp's service offerings and market reach, fostering sustained growth and competitive advantage in the diagnostics and drug development sectors.

Negative Factors

Margin Pressure

Declining EBIT margins suggest increasing cost pressures or pricing challenges, which may impact profitability and limit Labcorp's ability to invest in growth initiatives over the long term.

Regulatory Risks

Regulatory uncertainties, such as changes in healthcare policies, pose risks to Labcorp's revenue streams, potentially affecting its financial stability and strategic planning.

Debt Levels

While moderate, the existing debt levels could limit financial flexibility, especially if interest rates rise, impacting Labcorp's ability to fund new projects or weather economic downturns.

Labcorp Holdings Business Overview & Revenue Model

Company Description

Labcorp Holdings, Inc. provides laboratory services to help doctors, hospitals, pharmaceutical companies, researchers and patients make clear and confident decisions. The company was founded on April 16, 2024 and is headquartered in Burlington, NC.

How the Company Makes Money

Labcorp generates revenue primarily through its laboratory services and drug development offerings. The company's revenue model is driven by a fee-for-service structure, where clients pay for individual tests and services provided. Key revenue streams include diagnostic testing services for both patients and healthcare providers, which encompass routine blood tests, genetic testing, and specialized assays. Additionally, Labcorp's Drug Development segment contributes significantly to its earnings by providing clinical trial services, laboratory services, and consulting to pharmaceutical companies. Strategic partnerships with healthcare organizations, pharmaceutical firms, and payers further enhance Labcorp's revenue potential, as they often lead to long-term contracts and increased testing volumes. The company also benefits from a diverse customer base, including hospitals, physicians, and government agencies, which helps stabilize its income and mitigate risks associated with market fluctuations.

Labcorp Holdings Financial Statement Overview

Summary

Labcorp Holdings exhibits a solid financial foundation with noteworthy cash flow performance and a stable capital structure. However, profitability has faced challenges, with margins under pressure and fluctuating revenue trends. Despite this, the firm maintains a reasonable debt level and continues to generate healthy cash flows.

Income Statement

Labcorp Holdings shows a mixed performance in its income statement. The Gross Profit Margin for TTM (Trailing-Twelve-Months) is approximately 28.14%, indicating decent profitability. Net Profit Margin for TTM is around 5.66%, reflecting a slight improvement from the previous year but still lower compared to earlier periods. Revenue growth has been inconsistent, with a decline observed from 2021 to 2023, followed by a recovery in TTM. The EBIT Margin has seen a consistent decline over the years, reaching 8.83% in TTM, which could be a concern. EBITDA Margin for TTM is 10.10%, showcasing a moderate level of operating profitability.

Balance Sheet

The Balance Sheet of Labcorp Holdings presents a stable yet cautious financial position. The Debt-to-Equity Ratio in TTM is 0.77, indicating moderate leverage. Return on Equity (ROE) has decreased over the years, reaching 9.01% in TTM, signaling a reduced return on shareholders' equity. The Equity Ratio stands at 46.91% in TTM, suggesting a balanced capital structure with a significant portion of assets financed by equity. The consistent reduction in Stockholders' Equity from 2021 to TTM could warrant attention.

Cash Flow

Labcorp Holdings demonstrates strong cash flow management. The Free Cash Flow Growth Rate for TTM is 15.13%, indicating positive cash flow growth. Operating Cash Flow to Net Income Ratio is 2.22, reflecting robust cash flow generation relative to net income. The Free Cash Flow to Net Income Ratio is 1.65, showcasing efficient conversion of earnings into cash. The company has maintained a positive trend in operating and free cash flows despite fluctuations in net income.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	13.48B	13.01B	12.16B	11.86B	13.14B	13.98B
Gross Profit	3.79B	3.62B	3.36B	3.71B	4.99B	4.95B
EBITDA	1.87B	1.81B	1.35B	1.95B	3.68B	3.25B
Net Income	763.40M	746.00M	418.00M	1.28B	2.38B	1.56B
Balance Sheet
Total Assets	18.06B	18.38B	16.73B	20.16B	20.39B	20.07B
Cash, Cash Equivalents and Short-Term Investments	647.30M	1.52B	536.80M	320.60M	1.47B	1.32B
Total Debt	6.55B	7.27B	5.95B	6.25B	6.34B	6.76B
Total Liabilities	9.57B	10.31B	8.83B	10.04B	10.09B	10.61B
Stockholders Equity	8.47B	8.05B	7.88B	10.10B	10.27B	9.44B
Cash Flow
Free Cash Flow	1.26B	1.10B	874.10M	1.47B	2.65B	1.75B
Operating Cash Flow	1.69B	1.59B	1.33B	1.96B	3.11B	2.14B
Investing Cash Flow	-1.22B	-1.37B	-1.17B	-1.65B	-884.60M	-643.20M
Financing Cash Flow	-105.50M	779.90M	-59.30M	-1.32B	-2.07B	-517.40M

Labcorp Holdings Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 279.06
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For LH, the sentiment is Positive. The current price of 279.06 is above the 20-day moving average (MA) of 278.18, above the 50-day MA of 272.34, and above the 200-day MA of 249.21, indicating a bullish trend. The MACD of 2.63 indicates Negative momentum. The RSI at 52.93 is Neutral, neither overbought nor oversold. The STOCH value of 72.20 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for LH.

Labcorp Holdings Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
STE	79 Outperform	$24.17B	37.20	9.29%	0.95%	2.47%	63.68%
IQV	79 Outperform	$30.72B	27.51	21.41%	―	3.53%	-10.72%
LH	76 Outperform	$23.50B	31.18	9.27%	1.00%	7.98%	72.22%
BIIB	74 Outperform	$20.31B	13.40	9.76%	―	3.48%	31.44%
DGX	73 Outperform	$21.12B	22.58	13.13%	1.63%	12.58%	13.00%
PODD	68 Neutral	$21.87B	93.96	16.14%	―	25.99%	-40.46%
Sector *	51 Neutral	$7.86B	-0.30	-43.30%	2.27%	22.53%	-2.21%

Labcorp Holdings Corporate Events

Labcorp Holdings to Join Morgan Stanley Healthcare Conference

On August 27, 2025, Labcorp Holdings announced that its executive management team will participate in a fireside chat at the Morgan Stanley 23rd Annual Global Healthcare Conference on September 9, 2025. The event will be available via a live audio webcast on the company’s Investor Relations website, potentially enhancing Labcorp’s visibility and engagement with stakeholders in the healthcare industry.

Labcorp Declares Quarterly Dividend, Enhancing Shareholder Value

On July 10, 2025, Labcorp Holdings Inc. announced that its Board of Directors declared a quarterly cash dividend of $0.72 per share, payable on September 11, 2025, to stockholders recorded by August 28, 2025. This decision reflects Labcorp’s ongoing commitment to returning value to its shareholders and may enhance its attractiveness to investors, reinforcing its position in the laboratory services industry.

Labcorp Holdings Secures $1 Billion Credit Facility

On June 27, 2025, Labcorp Holdings Inc. entered into a Fourth Amended and Restated Credit Agreement with Bank of America and other lenders, establishing a $1 billion senior unsecured revolving credit facility set to mature in 2030. This agreement replaces the previous credit facility due in 2026 and includes options to increase the credit amount, reflecting Labcorp’s strategic financial positioning and potential for expansion.

Labcorp Holdings to Announce Q2 2025 Financial Results

Labcorp Holdings Inc. announced it will release its financial results for the second quarter of 2025 on July 24, 2025, before the market opens. The company will host a conference call and webcast at 9 a.m. ET on the same day to discuss the results, with the earnings press release and financial information available on the Labcorp Investor Relations website. A replay of the webcast will be accessible until July 11, 2026.