Burlington, North Carolina-based Labcorp Holdings Inc. (LH) provides laboratory services that aid doctors, hospitals, pharmaceutical companies, researchers, and patients. Valued at a market capitalization of $21.7 billion, it operates through two segments, Diagnostics Laboratories and Biopharma Laboratory Services. LH offers various tests, including blood chemistry analyses, urinalyses, blood cell counts, thyroid tests, PAP tests, hemoglobin A1C, PSA tests, and tests for sexually transmitted diseases, amon ...

Core Viewpoint - Labcorp Holdings has shown mixed performance in its recent earnings report, with adjusted earnings per share exceeding estimates but revenues falling short, leading to a decline in share price over the past month [1][4]. Financial Performance - Labcorp reported Q4 2025 adjusted earnings per share of $4.07, beating the Zacks Consensus Estimate by 3% and reflecting an 18% increase year-over-year [2]. - Full-year adjusted earnings per share reached $16.44, a 12.8% increase from the previous year, also surpassing the Zacks Consensus Estimate by 0.8% [3]. Revenue Analysis - Q4 revenues increased by 5.7% year-over-year to $3.52 billion, although this figure missed the Zacks Consensus Estimate by 1% [4]. - Full-year revenues rose 7.2% year-over-year to $13.95 billion, again falling short of the Zacks Consensus Estimate by 0.3% [4]. Segment Performance - Diagnostics Laboratories generated revenues of $2.73 billion in Q4, marking a 5.5% improvement year-over-year [5]. - Biopharma Laboratory Services revenues increased by 3.4% to $793 million, driven by organic growth of 0.6% and a foreign currency translation gain of 2.8% [6]. Margin Performance - Gross margin expanded by 133 basis points to 28.2% in Q4, despite a 3.7% rise in the cost of revenues [7]. - Adjusted operating income improved by 51% year-over-year to $454.6 million, with the adjusted operating margin expanding by 389 basis points to 12.9% due to a 9.5% decline in SG&A expenses [7]. Cash Position - At the end of Q4, Labcorp had cash and cash equivalents of $532.3 million, down from $1.52 billion a year ago, while long-term debt remained stable at $5.08 billion [8]. Guidance for 2026 - Labcorp expects total revenues for 2026 to be in the range of $14.61 billion to $14.79 billion, indicating growth of 4.7% to 6% [9]. - Adjusted earnings per share for 2026 are projected to be between $17.55 and $18.25, with the Zacks Consensus Estimate at $17.62 [10]. Estimate Trends - Recent estimates for Labcorp have shown a downward trend, indicating a potential shift in investor sentiment [11]. VGM Scores - Labcorp currently holds a strong Growth Score of A, with a B in Momentum and Value, placing it in the top 40% for value investors [12]. Outlook - The overall trend in estimates has been downward, and Labcorp holds a Zacks Rank 3 (Hold), suggesting an expectation of an in-line return in the coming months [13].

Illumina and Labcorp expand collaboration to broaden access to precision oncology testing Accessibility StatementSkip Navigation SAN DIEGO, March 18, 2026 /PRNewswire/ -- Illumina, Inc. (NASDAQ: ILMN) and Labcorp (NYSE: LH), a global leader of innovative and comprehensive laboratory services, today announced an expanded collaboration to advance precision oncology through innovative applications of next-generation sequencing (NGS) solutions across the healthcare ecosystem. Projects are expected to include pr ...

Company Overview - Labcorp Holdings, headquartered in Burlington, NC, is a leading healthcare diagnostics company that provides comprehensive clinical laboratory services and end-to-end drug development support [11] - In 2015, Labcorp acquired Covance, a drug development services company that offers a wide range of early-stage and late-stage product development services primarily to the pharmaceutical and biotechnology industries [11] Investment Ratings - Labcorp is currently rated as 3 (Hold) on the Zacks Rank, with a VGM Score of A, indicating a strong overall performance [12] - The company has a Value Style Score of B, supported by attractive valuation metrics such as a forward P/E ratio of 15.64, which may appeal to value investors [12] Earnings Estimates - In the last 60 days, four analysts have revised their earnings estimates higher for fiscal 2026, with the Zacks Consensus Estimate increasing by $0.04 to $17.65 per share [12] - Labcorp has an average earnings surprise of +3.1%, suggesting a positive trend in earnings performance [12] Investment Consideration - With a solid Zacks Rank and top-tier Value and VGM Style Scores, Labcorp should be considered for investors' short lists [13]

Core Insights - Labcorp Holdings Inc. is positioned for growth due to its expansion in strategic high-growth areas such as neurology and autoimmune disease, alongside enhancing partnerships with hospitals and healthcare systems [1][3][5] - The company has experienced a stock increase of 10.2% over the past year, outperforming the industry and the S&P 500 [2] - Labcorp's market capitalization stands at $23.61 billion, with an earnings yield of 6.2%, which is higher than the industry's 4.1% yield [2] Growth Drivers - Labcorp is focusing on specialty testing in oncology, women's health, autoimmune disease, and neurology, which are projected to grow significantly faster than other therapeutic areas [3][4] - The company has expanded its oncology testing capabilities to over 450 tests and integrated Invitae to enhance genetic testing [3] - New Alzheimer's tests have been introduced, and partnerships are being formed to improve access to colorectal cancer screening tests [4] Strategic Acquisitions - Labcorp has built strategic relationships with health systems and laboratories, enhancing its market presence [5] - In the fourth quarter, the company invested $258 million in acquisitions, contributing 1.2% to top-line growth [6] - Recent acquisitions include outreach assets from Community Health Systems and anatomic pathology assets from Incyte Diagnostics [6] Operational Efficiency - Labcorp achieved $100-$125 million in annual savings through its LaunchPad initiative, which focuses on business process improvements [9][10] - AI-powered solutions like Labcorp Test Finder have streamlined appointment scheduling and results reporting [9] - The company has enhanced its enterprise margin by over 50 points due to strong growth and disciplined expense management [10] Challenges - Labcorp faces currency headwinds due to its significant international exposure, which may impact revenues as the U.S. dollar strengthens [11] - Macroeconomic conditions, including inflation and geopolitical tensions, are affecting demand for diagnostic testing and drug development services, impacting profitability [12] Financial Outlook - The Zacks Consensus Estimate for Labcorp's 2026 earnings per share has increased by 0.3% to $17.65, with projected revenues of $14.67 billion, indicating a 5.2% growth from 2025 [13]

Revenue Growth - The Company's revenues for the year ended December 31, 2025, were $13,951.7 million, a 7.2% increase from $13,008.9 million in 2024, driven by organic revenue growth of 4.4%, acquisitions net of divestitures contributing 2.5%, and favorable foreign currency translation of 0.4%[217] - Dx segment revenues increased to $10,876.5 million, up 7.2% from $10,144.3 million in 2024, with organic revenue growth of 4.1% and acquisitions net of divestitures contributing 3.2%[221] - BLS segment revenues reached $3,098.2 million, a 6.0% increase from $2,922.6 million in 2024, primarily due to organic growth of 4.0% and favorable foreign currency translation of 2.0%[223] Cost and Expenses - Cost of revenues increased by 5.9% to $9,939.2 million, while the cost of revenues as a percentage of revenues decreased to 71.2% from 72.1% in 2024, reflecting operational efficiencies[224] - Selling, general, and administrative expenses were $2,230.0 million, a slight increase of 0.6% from $2,216.3 million in 2024, with the percentage of revenues decreasing to 15.9% from 17.1%[225] - The Company recorded net restructuring charges of $127.2 million for 2025, a significant increase of 176.5% from $46.0 million in 2024, primarily due to restructuring activities[228] Interest and Taxes - Interest expense rose by 7.6% to $224.1 million in 2025, compared to $208.3 million in 2024, driven by higher weighted-average interest rates[230] - The provision for income taxes was $229.8 million, with an effective tax rate decreasing to 20.7% from 22.1% in 2024, mainly due to the release of specific uncertain tax positions[233] Cash Flow and Liquidity - The Company's net cash provided by operating activities was $1,640.5 million, an increase from $1,585.8 million in 2024, attributed to higher cash earnings[240] - Cash and cash equivalents at December 31, 2025, totaled $532.3 million, down from $1,518.7 million in 2024, indicating a decrease in liquidity[239] - Net cash used for financing activities in 2025 was $1,457.0 million, a decrease from net cash provided of $779.9 million in 2024, primarily due to a $2,000.0 million decrease in proceeds from senior note offerings[244] Capital Expenditures and Financing - Capital expenditures for the year ended December 31, 2025, were $434.5 million, representing 3.1% of revenues, with an expected increase to 4.0% in 2026[243] - The company had $1,000.0 million of available borrowings under its revolving credit facility, which was amended on June 27, 2025, and expires in 2030[245] - The company borrowed an additional $225.0 million under its accounts receivable facility, bringing the total outstanding to $525.0 million as of December 31, 2025[246] Future Obligations - As of December 31, 2025, the company had total future payments of $5,622.6 million, with $500.3 million payable within 12 months[254] - The company expects to pay up to $415.0 million in connection with pending acquisitions, including $85.0 million contingent on performance[256] - The company had total future lease payments of $1,144.3 million, with $234.4 million due within 12 months[255] Compliance and Ratings - The company is in compliance with all covenants under its credit facilities and expects to remain compliant for the next 12 months[245] - The company has investment grade credit ratings from Moody's and S&P Global Ratings, enhancing its ability to access capital markets[252] Accounting and Impairment - The Company accounts for business combinations using the acquisition method, recording acquired assets at estimated fair values as of the acquisition date[273] - The Company recognizes deferred tax assets and liabilities based on differences between financial statement carrying amounts and tax bases, measured using enacted tax rates[274] - The Company performed its annual goodwill impairment testing as of October 1, 2025, concluding that the fair values of each reporting unit exceeded their carrying values[281] - The Company assesses goodwill and indefinite-lived intangible assets for impairment at least annually or when circumstances indicate potential impairment[276] Foreign Exchange Exposure - Approximately 13.5% of the Company's revenues for the year ended December 31, 2025, were denominated in currencies other than USD, with significant exposure to CAD, Swiss Franc, Euro, and British Pound[289] - A hypothetical 10% change in average exchange rates would have impacted income before income taxes for 2025 by approximately $31.7 million[289] - The Company had eight open foreign exchange forward contracts with a notional value totaling approximately $238.0 million as of December 31, 2025[290] - The Company is a party to cross-currency swap agreements with an aggregate notional amount of $1,200.0 million to hedge against foreign exchange movements[291] - The Company entered into fixed-to-variable interest rate swap agreements for $500.0 million of senior notes due 2031 to hedge against changes in fair value[294] Legal Reserves - The Company records an aggregate legal reserve based on historical loss rates and trends in settlements and defense costs[287]

Core Insights - Labcorp is a significant player in the laboratory services industry, recognized for its extensive diagnostic solutions [1] - The company has recently adjusted its stock rating to Neutral while increasing the price target, indicating potential growth [5] Financial Performance - Labcorp's current stock price is $285.30, reflecting an increase of $2.63 or 0.93% [3] - The stock has shown volatility over the past year, with a high of $293.72 and a low of $209.38 [3] - The market capitalization of Labcorp is approximately $23.65 billion, with a trading volume of 618,341 shares [4] Strategic Initiatives - Labcorp's collaboration with PathAI aims to enhance its digital pathology capabilities through the FDA-cleared AISight® Dx1 platform [2] - The AISight® Dx1 platform is a cloud-based technology that utilizes AI to assist pathologists in managing slides and improving diagnostics [2]

Core Insights - Labcorp has announced an expanded collaboration with PathAI to deploy AISight® Dx, an FDA-cleared digital pathology platform, across its national network of anatomic pathology labs and hospital collaborations, aiming to enhance efficiency, collaboration, and patient care [1][2] Group 1: Technology and Implementation - AISight® Dx is a cloud-based technology that enables pathologists to view and manage slides digitally, utilizing AI to support key diagnostic processes [1][2] - The platform will facilitate fully digital workflows for case management, slide review, collaboration, and annotation, integrating AI-powered image analysis and secure storage [2] - Labcorp's deployment of AISight Dx is part of its commitment to modernize pathology through AI, aiming for faster and more consistent results for patients and providers [2][3] Group 2: Strategic Importance - The collaboration builds on Labcorp's strategic investment in PathAI made in 2019, which has evolved to include AI-driven clinical trial support and validation of novel AI-pathology solutions [3] - Labcorp's leadership in diagnostics positions it as an ideal partner for PathAI in the mission to modernize pathology through software and AI [3] Group 3: Company Overview - Labcorp is a global leader in laboratory services, providing insights that help healthcare professionals make informed decisions, with nearly 71,000 employees serving clients in approximately 100 countries [4] - The company supported over 85% of new drugs and therapeutic products approved by the FDA in 2025 and performed more than 750 million tests globally [4]

Core Insights - The company experienced a 7% increase in top-line revenue and a 13% growth in adjusted EPS in 2025, driven by enhanced health system partnerships contributing over $1 billion in revenue over three years [1] Revenue Growth - Esoteric and specialty testing achieved double-digit growth, acting as a high-margin engine that captures broader routine testing volume once physicians adopt Labcorp for complex diagnostics [1] Genetic Testing Expansion - The integration of Invitae has expanded genetic testing capabilities, with management viewing it as a fully embedded component of their specialty portfolio, growing 2-3 times faster than the market [1] Central Laboratory Strength - Central Laboratory strength is attributed to high utilization in oncology, neurology, and cardiometabolic clinical trials, supported by a global footprint capable of standardized testing across 100 countries [1] Operational Efficiency - Operational efficiency is being enhanced through AI-powered solutions in pathology and microbiology, along with the implementation of Roche's fully automated mass spectrometry solution [1] Strategic Decisions - Early Development (ED) faced challenges, leading to a strategic decision to streamline the business by $50 million in annual revenue to improve utilization and segment profitability [1]

Core Insights - Labcorp reported a strong performance in 2025 with over 7% revenue growth, 13% adjusted EPS growth, and margin expansion of more than 50 basis points [3][5] - The company highlighted a robust pipeline for mergers and acquisitions (M&A) and a backlog of $8.7 billion in Biopharma Laboratory Services (BLS) [4][11] Financial Performance - Fourth-quarter revenue reached $3.5 billion, up 5.6% year over year, driven by organic growth of 3.8%, acquisitions contributing 1.2%, and foreign currency translation of 0.6% [8] - Adjusted EPS for the fourth quarter was $4.07, reflecting an 18% increase year over year [9] - Free cash flow for the quarter was $490 million, down from $665 million, primarily due to working capital timing [9] Growth Strategy - The company launched over 130 new tests in 2025, focusing on oncology, women's health, neurology, and autoimmune diseases [6][7] - Labcorp's OnDemand service expanded to offer tests for over 200 biomarkers, including food allergies and thyroid health [7] - Management emphasized technology and AI initiatives to enhance efficiency and customer experience, including AI-driven tools for scheduling and reporting [7] M&A Activity - In the fourth quarter, Labcorp completed several acquisitions, including outreach laboratory services from Parkview Health and anatomic pathology assets from Incyte Diagnostics [2] - The company signed or closed 13 deals, contributing over $1 billion in revenue growth over the past three years [2] 2026 Guidance - Labcorp forecasts enterprise revenue growth of 4.7% to 6% for 2026, with adjusted EPS expected to be between $17.65 and $18.25, implying about 9% growth at the midpoint [5][15] - Diagnostics revenue is projected to rise 5% to 6%, with half of the growth expected from volume and half from price/mix [13] - BLS revenue is anticipated to grow 3% to 5%, with Central Labs expected to grow mid-single digits organically [14] Operational Highlights - Diagnostics revenue was $2.7 billion, up 5.5%, with organic growth of 4.1% and acquisitions contributing 1.5% [10] - BLS revenue was $793 million, up 3.4%, with Central Labs revenue growing 11.1% [11] - The company reported a book-to-bill ratio of 1.16 for the quarter, indicating strong demand in Central Labs [12] Leadership Changes - Labcorp announced the upcoming retirement of key executives, with successors appointed under a succession plan [21]