/Labcorp%20Holdings%20Inc_%20lab%20tests-by%20sergeyryzhov%20via%20iStock.jpg)
Burlington, North Carolina-based Labcorp Holdings Inc. (LH) is a provider of laboratory services. It offers various tests, such as blood chemistry analyses, urinalyses, thyroid, PAP, substance abuse, and many more. With a market cap of $19.6 billion, Labcorp operates through Diagnostics Laboratories and Biopharma Laboratory Services segments.
Companies worth $10 billion or more are generally described as "large-cap stocks," Labcorp fits right into that category, with its market cap exceeding the threshold, reflecting its significant size and influence in the competitive industry of diagnostics & research.
Labcorp touched its two-year high of $258.59 on Mar. 5 and is currently trading 9.8% below that peak. Meanwhile, LH rose nearly 1% over the past three months, outpacing the Nasdaq Composite’s ($NASX) 10.6% drop during the same time frame.
While Labcorp gained 6% over the past six months, significantly outpacing Nasdaq’s 1.6% dip during the same time frame, it soared 9.3% over the past 52 weeks, marginally lagging behind Nasdaq’s 9.7% returns over the past year.
To confirm the bullish trend and recent downturn, LH has traded mostly above its 200-day moving average since late July last year and dropped below its 50-day moving average in the second week of March.
Labcorp’s stock observed a marginal dip after the release of its mixed Q4 results on Feb. 6. Driven by robust organic and inorganic growth in revenues, Labcorp’s overall topline soared 9.8% year-over-year to $3.3 billion, exceeding the Street’s expectations. However, due to higher cost of sales, the company reported a 16 basis point contraction in gross margin to 26.9% and due to an 11.7% surge in SG&A expenses Labcorp’s adjusted operating margin also got affected. Nonetheless, its adjusted net income increased by a modest 2.9% year-over-year to $290.4 million and its adjusted EPS of $3.45 surpassed the Street’s expectations by 1.5%.
On a brighter note, Labcorp’s CEO Adam Schechter expects the company to deliver strong growth and margin expansion across both its segments in 2025.
Meanwhile, Labcorp has outperformed its peer Waters Corporation’s (WAT) 3.4% uptick over the past six months and 8.8% gains over the past year.
Among the 16 analysts covering the Labcorp stock, the consensus rating is a “Strong Buy.” Its mean price target of $278.06 suggests a 19.2% upside potential from current price levels.
