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1. Company Snapshot

1.a. Company Description

Laboratory Corporation of America Holdings operates as a global life sciences company that provides vital information to help doctors, hospitals, pharmaceutical companies, researchers, and patients make clear and confident decisions.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, prostate-specific antigens, tests for sexually transmitted diseases, hepatitis C tests, microbiology cultures and procedures, and alcohol and other substance-abuse tests.


The company also provides specialty testing services comprising gene-based and esoteric testing; advanced tests target specific diseases, including anatomic pathology/oncology, cardiovascular disease, coagulation, diagnostic genetics, endocrinology, infectious disease, women's health, pharmacogenetics, and parentage and donor testing; and occupational testing services, medical drug monitoring services, chronic disease programs, and kidney stone prevention tests.It provides online and mobile applications to enable patients to check test results; and online applications for managed care organizations and accountable care organizations.It offers end-to-end drug development, medical device, and companion diagnostic development solutions from early-stage research to clinical development and commercial market access.


It serves managed care organizations, pharmaceutical, biotechnology, medical device and diagnostics companies, governmental agencies, physicians and other healthcare providers, hospitals and health systems, employers, patients and consumers, contract research organizations, and independent clinical laboratories.Laboratory Corporation of America Holdings has a collaboration agreement with Tigerlily Foundation to increase clinical trial diversity for women of color.The company was incorporated in 1994 and is headquartered in Burlington, North Carolina.

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1.b. Last Insights on LH

Labcorp's recent performance was negatively impacted by a trimmed 2025 sales outlook, despite Q3 earnings beating forecasts. The company's revenue missed estimates, and macro pressures weighed on its outlook. Additionally, IFP Advisors Inc reduced its stake in Labcorp by 24.4% during Q2, potentially signaling decreased investor confidence. However, Labcorp's biopharma lab growth and efficiency gains provided momentum. The company's resilient margins and dividend support may position it for gradual upside.

1.c. Company Highlights

2. Labcorp's Q3 2025 Earnings: Strong Revenue Growth and Margin Expansion

Labcorp Holdings reported a robust Q3 2025, with revenue increasing 9% to $3.6 billion and adjusted EPS growing 19% to $4.18, beating analyst estimates of $4.13. The Diagnostic Laboratories segment drove revenue growth, with an 8.5% increase, fueled by 6% organic growth and acquisitions. The company's adjusted EPS growth was driven by margin expansion, with the Diagnostics segment margin expanding 110 basis points in the quarter.

Publication Date: Nov -02

📋 Highlights
  • Strong Q3 2025 Performance:: Revenue rose 9% to $3.6B, adjusted EPS increased 19% to $4.18.
  • Segment Growth Drivers:: Diagnostic Labs grew 8.5% (6% organic), Biopharma Labs grew 8.3% (Central Labs up 7% in constant currency).
  • 2025 Guidance:: Revenue growth 7.4–8%, adjusted EPS $16.15–$16.50 (12% growth midpoint), free cash flow $1.165B–$1.285B.
  • Strategic Divestitures:: $50M annualized revenue loss from noncore asset exits, but expected to boost operating income slightly.
  • Debt Leverage:: 2.4x gross debt/EBITDA, below the 2.5x–3x target range, reflecting financial discipline.

Segment Performance

The Biopharma Laboratory Services segment reported revenue growth of 8.3%, with Central Labs revenue up 7% in constant currency. The company's consumer-driven testing business is seeing significant growth, with a strong focus on consumerism and meeting patients where they are. Labcorp interacts with over 75 million patients through various channels and is adding new tests to its on-demand e-commerce platform.

Guidance and Outlook

Labcorp updated its 2025 full-year guidance, with revenue growth expected to be 7.4% to 8%. The company expects adjusted EPS to be $16.15 to $16.50, with a growth rate of 12% at the midpoint. Free cash flow guidance is $1.165 billion to $1.285 billion. The company's debt leverage is 2.4x gross debt to trailing 12-month adjusted EBITDA, below the targeted range of 2.5x to 3x. Analysts estimate next year's revenue growth at 4.5%.

Valuation and Metrics

Labcorp's current valuation metrics indicate a P/E Ratio of 24.68, EV/EBITDA of 13.44, and a Free Cash Flow Yield of 6.54%. The company's ROE is 10.2%, and ROIC is 6.36%. With a Net Debt / EBITDA ratio of 2.95, Labcorp's leverage is relatively high, but within the company's target range. The stock's valuation multiples suggest that the market is pricing in moderate growth expectations.

Operational Highlights

The company is making progress on its strategy, including expanding its business in high-growth specialty areas such as oncology, women's health, and neurology. Labcorp introduced several innovative testing capabilities, including a comprehensive genomic profiling test for solid tumors and a blood-based test for Alzheimer's disease. The company's Central Laboratory business remains strong, with a good book-to-bill ratio, and is expected to grow in the mid-single-digit range for the full year.

3. NewsRoom

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Labcorp Holdings Inc. (NYSE:LH) Receives Average Recommendation of “Moderate Buy” from Analysts

Dec -05

Source: defenseworld.net

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Community Health Systems Completes Sale of Select Outreach Laboratory Assets to Labcorp

Dec -02

Source: businesswire.com

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Should You Continue to Hold LH Stock in Your Portfolio?

Dec -02

Source: zacks.com

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Boston Family Office LLC Acquires New Holdings in Labcorp Holdings Inc. $LH

Dec -02

Source: defenseworld.net

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Labcorp Holdings Inc. $LH Position Cut by Brandes Investment Partners LP

Dec -02

Source: defenseworld.net

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Advisors Asset Management Inc. Buys 770 Shares of Labcorp Holdings Inc. $LH

Dec -01

Source: defenseworld.net

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Labcorp Appoints Victor Bulto to Board of Directors

Nov -24

Source: prnewswire.com

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Cetera Investment Advisers Lowers Stock Position in Labcorp Holdings Inc. $LH

Nov -24

Source: defenseworld.net

4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (4.57%)

6. Segments

Diagnostics Laboratories

Expected Growth: 4.5%

Diagnostics Laboratories from Laboratory Corporation of America Holdings' 4.5% growth is driven by increasing demand for molecular diagnostics, expansion in esoteric testing, and growing adoption of precision medicine. Additionally, the company's strategic acquisitions, investments in digital health, and cost savings initiatives contribute to its growth momentum.

Biopharma Laboratory Services

Expected Growth: 4.8%

The 4.8% growth of Biopharma Laboratory Services from Laboratory Corporation of America Holdings is driven by increasing demand for clinical trial services, expansion into emerging markets, and growing adoption of precision medicine. Additionally, strategic partnerships, investments in digital technologies, and a strong pipeline of new testing services also contribute to the segment's growth.

Intercompany Eliminations and Other

Expected Growth: 3.5%

Intercompany Eliminations and Other segment of Laboratory Corporation of America Holdings grew 3.5% driven by increased testing volumes, strategic acquisitions, and cost savings initiatives. Additionally, the company's focus on personalized medicine and genomic testing contributed to the growth. Furthermore, the segment benefited from the expansion of its esoteric testing business and the integration of newly acquired companies.

7. Detailed Products

Clinical Trials

Laboratory Corporation of America Holdings provides clinical trial testing services to pharmaceutical and biotechnology companies, supporting the development of new drugs and therapies.

Esoteric Testing

LabCorp offers esoteric testing services for rare and complex diseases, including genetic testing, molecular diagnostics, and anatomic pathology.

Routine Testing

LabCorp provides routine testing services for common health conditions, including cholesterol testing, blood glucose testing, and complete blood counts.

Anatomic Pathology

LabCorp offers anatomic pathology services, including tissue and cell analysis, to help diagnose and manage diseases such as cancer.

Molecular Diagnostics

LabCorp provides molecular diagnostics services, including genetic testing and DNA analysis, to help diagnose and manage diseases.

Covance Drug Development

LabCorp's Covance Drug Development segment provides drug development services, including clinical trial management and regulatory consulting.

8. Laboratory Corporation of America Holdings's Porter Forces

Forces Ranking

Threat Of Substitutes

Laboratory Corporation of America Holdings faces moderate threat from substitutes due to the presence of alternative diagnostic testing methods and services.

Bargaining Power Of Customers

Customers of Laboratory Corporation of America Holdings have limited bargaining power due to the company's strong brand reputation and wide range of diagnostic testing services.

Bargaining Power Of Suppliers

Suppliers of Laboratory Corporation of America Holdings have limited bargaining power due to the company's large scale of operations and diversified supplier base.

Threat Of New Entrants

The threat of new entrants in the diagnostic testing industry is low due to the high barriers to entry, including regulatory hurdles and significant capital requirements.

Intensity Of Rivalry

The intensity of rivalry in the diagnostic testing industry is high due to the presence of established competitors, such as Quest Diagnostics, and the need for continuous innovation to stay competitive.

9. SWOT Analysis

Strength

Weaknesses

Opportunities

Threats

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

Value
Debt Weight 39.89%
Debt Cost 5.01%
Equity Weight 60.11%
Equity Cost 8.98%
WACC 7.40%
Leverage 66.37%

11. Quality Control: Laboratory Corporation of America Holdings passed 2 out of 9 key points

12.a Historical Valuation

12.b Price/Earnings Ratio

12.c Margin Valuation

12.d Peers Valuation

Peers Group Analysis

Stock-Card
LabCorp

A-Score: 5.5/10

Value: 3.7

Growth: 4.3

Quality: 5.1

Yield: 2.0

Momentum: 8.5

Volatility: 9.3

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Medpace

A-Score: 4.8/10

Value: 1.3

Growth: 9.2

Quality: 8.1

Yield: 0.0

Momentum: 8.5

Volatility: 2.0

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Natera

A-Score: 4.5/10

Value: 4.0

Growth: 7.1

Quality: 3.3

Yield: 0.0

Momentum: 7.5

Volatility: 5.0

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Waters

A-Score: 3.9/10

Value: 1.5

Growth: 5.2

Quality: 7.5

Yield: 0.0

Momentum: 3.0

Volatility: 6.3

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Twist Bioscience

A-Score: 3.6/10

Value: 6.8

Growth: 6.1

Quality: 4.8

Yield: 0.0

Momentum: 2.0

Volatility: 2.0

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Charles River Laboratories

A-Score: 3.3/10

Value: 4.7

Growth: 4.1

Quality: 3.1

Yield: 0.0

Momentum: 3.5

Volatility: 4.3

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Peers Metrics

12.e Scoring Insights

12.f DCF BETA

Parameters

Short Term Growth

Short term Time

Long-Term Growth

WACC

Target Price

258.23$

Current Price

258.23$

Potential

-0.00%

Expected Cash-Flows