Core Viewpoint - Labcorp Holdings (LH) has received an upgrade to a Zacks Rank 2 (Buy), indicating a positive outlook for the company's earnings estimates, which significantly influence stock prices [1][3]. Earnings Estimates and Stock Price Impact - The Zacks rating system is based on changes in earnings estimates, which are closely correlated with near-term stock price movements [4][6]. - An increase in earnings estimates typically leads to higher fair value calculations by institutional investors, resulting in stock price movements [4]. Recent Performance and Outlook - For the fiscal year ending December 2025, Labcorp is expected to earn $16.30 per share, with a 1.6% increase in the Zacks Consensus Estimate over the past three months [8]. - The upgrade reflects an improvement in Labcorp's underlying business, which is likely to drive the stock price higher as investors respond positively to this trend [5][10]. Zacks Rank System - The Zacks Rank system classifies stocks into five groups based on earnings estimates, with only the top 20% of stocks receiving a "Strong Buy" or "Buy" rating [9][10]. - Labcorp's upgrade to Zacks Rank 2 places it in the top 20% of Zacks-covered stocks, suggesting potential for market-beating returns in the near term [10].

Core Insights - Labcorp Holdings Inc. (LH) is a leading global life sciences company with a market cap of $22.9 billion, providing diagnostic, drug development, and laboratory services [1] Financial Performance - LH is expected to report Q3 earnings of $4.12 per share, a 17.7% increase from $3.50 per share in the same quarter last year, having surpassed Wall Street's estimates for the past four quarters [2] - For fiscal 2025, earnings are projected to be $16.30 per share, an 11.9% increase from $14.57 in fiscal 2024, with further growth expected to $17.89 per share in fiscal 2026, representing a 9.8% year-over-year increase [3] Stock Performance - LH stock has increased by 31.9% over the past 52 weeks, outperforming the S&P 500 Index's 17.9% gain and the Health Care Select Sector SPDR Fund's 4.5% decline during the same period [4] - Following the release of strong Q2 2025 results, LH shares rose by 6.9%, with adjusted EPS of $4.35 and revenues of $3.53 billion exceeding consensus estimates [5] Analyst Ratings - The consensus opinion on LH stock is highly optimistic, with a "Strong Buy" rating from 14 out of 18 analysts, while four recommend a "Hold," and the average price target is $296.70, indicating a 6.1% potential upside [6]

Group 1 - Evercore ISI raised the price target on Labcorp (LH) to $305 from $300 while maintaining an Outperform rating on the shares [1] - The firm's survey indicates a positive outlook for preclinical CROs, with rising budgets and declining cancellations [1] - There is stable demand for discovery and toxicology services projected into 2025 and 2026 [1]

Core Insights - Labcorp Holdings Inc. will release its financial results for Q3 2025 on October 28, 2025, before market opening [1] - A conference call and webcast will be held at 9 a.m. ET on the same day to discuss the results [1][2] - The earnings press release and financial information will be available on the Labcorp Investor Relations website [1] Company Overview - Labcorp is a global leader in laboratory services, providing innovative and comprehensive solutions to healthcare providers, pharmaceutical companies, and researchers [4] - The company employs nearly 70,000 individuals and operates in approximately 100 countries, supporting over 75% of new drugs approved by the FDA in 2024 [4] - Labcorp performs more than 700 million tests annually for patients worldwide [4]

Core Viewpoint - Labcorp Holdings (LH) has shown strong stock performance, reaching a 52-week high and outperforming the broader medical sector and industry [1][2]. Financial Performance - Labcorp has consistently exceeded earnings expectations, reporting EPS of $4.35 against a consensus estimate of $4.14 in its last earnings report [2]. - For the current fiscal year, Labcorp is projected to achieve earnings of $16.3 per share with revenues of $14 billion, reflecting an 11.87% increase in EPS and a 7.65% increase in revenues [3]. - The next fiscal year forecasts earnings of $17.89 per share on $14.7 billion in revenues, indicating a year-over-year change of 9.74% in EPS and 4.98% in revenues [3]. Valuation Metrics - Labcorp's current trading metrics include a P/E ratio of 17.2X for the current fiscal year, which is above the peer industry average of 16.7X [7]. - The stock trades at a trailing cash flow multiple of 12.5X compared to the peer group's average of 10.1X, and has a PEG ratio of 1.79, positioning it favorably for value investors [7]. Zacks Rank and Style Scores - Labcorp holds a Zacks Rank of 2 (Buy) due to a positive earnings estimate revision trend, making it a suitable choice for investors [8]. - The company has a Value Score of A, a Growth Score of B, and a Momentum Score of F, resulting in a combined VGM Score of A [6][8]. Industry Comparison - The Medical Services industry is performing well, ranking in the top 41% of all industries, providing favorable conditions for Labcorp and its peers [11]. - Solventum Corporation (SOLV), a competitor, has a Zacks Rank of 1 (Strong Buy) and is expected to post earnings of $5.89 per share on revenues of $8.36 billion for the current fiscal year [9][10].

Core Insights - Labcorp Holdings Inc. is positioned for growth due to the robust performance of its Biopharma Laboratory Services segment and a strong focus on operational efficiency [1][3][5] - The company has experienced a 24.1% stock increase over the past year, outperforming the industry and the S&P 500 [2] - Despite strong financial health and operational initiatives, macroeconomic challenges may limit Labcorp's growth potential [1][9] Financial Performance - Labcorp has a market capitalization of $23.04 billion and an earnings yield of 5.8%, surpassing the industry's 4.2% [2] - The company reported a 11% year-over-year growth in its Biopharma Laboratory Services segment in Q2 2025, with Central Laboratories growing by 8% and Early Development by 20% [3][8] - The Zacks Consensus Estimate for Labcorp's 2025 earnings remains at $16.30, with revenues expected to reach $14.00 billion, indicating a 7.7% increase from 2024 [10] Operational Efficiency - Labcorp is enhancing operational efficiency through initiatives like LaunchPad, which improved the adjusted operating margin by 20 basis points in Q2 [5][6] - The introduction of digital solutions such as the Labcorp Diagnostic Assistant and eClaim Assist aims to streamline workflows and improve billing efficiencies [6] Financial Health - As of Q2 2025, Labcorp had cash and cash equivalents of $793 million, short-term debt of $500 million, and long-term debt of $5.08 billion [7] - The company returned capital to shareholders through $59.9 million in dividends and $200 million in stock repurchases, with a dividend payout ratio of 19% [7] Challenges - Macroeconomic factors, including inflation and geopolitical tensions, have negatively impacted demand for diagnostic testing and drug development services, leading to an 8.1% increase in the cost of revenues year-over-year [9]

Core Insights - Labcorp Holdings Inc. is valued at a market cap of $23 billion and is a leading global provider of comprehensive laboratory services [1] - The company operates through its Diagnostics Laboratories and Biopharma Laboratory Services segments, offering a wide range of testing, specialty diagnostics, and drug development solutions [1][2] Financial Performance - Labcorp's shares have fallen 2.7% from its 52-week high of $283.47 but have risen 5.4% over the past three months, outperforming The Health Care Select Sector SPDR Fund's (XLV) 2.6% gain [3] - Year-to-date, Labcorp's stock is up 20.3%, significantly exceeding XLV's 1.1% decline, and has soared 24.2% over the past 52 weeks compared to XLV's 12.4% decrease [4] - The company reported strong Q2 2025 results with adjusted EPS of $4.35 and revenues of $3.53 billion, surpassing estimates [5] - Growth in Q2 was driven by Diagnostics Laboratories, which grew 8.9% to $2.75 billion, and Biopharma Laboratory Services, which rose 11% to $784.8 million [5] - Full-year 2025 guidance has been raised, with revenue growth now expected at 7.5% - 8.6% and adjusted EPS at $16.05 - $16.50 [5] Market Position and Analyst Sentiment - Despite rival Quest Diagnostics Incorporated (DGX) outperforming Labcorp on a year-to-date basis with a 22.4% increase, Labcorp has outperformed DGX over the past 52 weeks [6] - Analysts maintain a bullish outlook on Labcorp, with a consensus rating of "Strong Buy" from 18 analysts and a mean price target of $295.53, representing a 5.9% premium to current levels [6]

Acquisition Details - Labcorp has completed the acquisition of select assets of BioReference Health for up to $225 million, which includes $192.5 million paid at closing and up to $32.5 million in performance-based earnout [5][9] - The acquisition enhances Labcorp's oncology diagnostics portfolio and expands access to high-quality laboratory services and testing capabilities for patients and physicians [6][9] Financial Performance - Labcorp has a market capitalization of $22.78 billion and an earnings yield of 5.9%, which is higher than the industry average of 4% [4] - In the second quarter of 2025, Labcorp invested $25 million in acquisitions and partnerships, indicating a strong pipeline for future growth [3] Market Context - The global cancer diagnostics market is projected to grow at a compound annual growth rate of 6.14% from 2025 to 2030, driven by increasing cancer prevalence and advancements in diagnostic technologies [10] - Labcorp's shares have increased by 20.8% over the past year, outperforming the industry, which has seen a decline of 19.9% [13] Recent Developments - In August, Labcorp expanded its cell and gene therapy laboratory in Madison, WI, enhancing its preclinical testing capabilities [11] - The company also launched a new FDA-cleared blood-based diagnostic test for Alzheimer's disease, further diversifying its service offerings [12]

Core Viewpoint - Zacks Premium offers various tools and resources to help investors make informed decisions and enhance their confidence in stock market investments [1]. Summary by Category Zacks Style Scores - Zacks Style Scores are indicators designed to assist investors in selecting stocks with the highest potential to outperform the market within the next 30 days, rated from A to F based on value, growth, and momentum characteristics [2]. Value Score - The Value Style Score focuses on identifying undervalued stocks using financial ratios such as P/E, PEG, Price/Sales, and Price/Cash Flow, aiming to find attractive investment opportunities before the market recognizes their true value [3]. Growth Score - The Growth Style Score emphasizes a company's financial health and future growth potential, analyzing projected and historical earnings, sales, and cash flow to identify stocks with sustainable long-term growth [4]. Momentum Score - The Momentum Style Score helps investors capitalize on price trends, utilizing metrics like one-week price changes and monthly earnings estimate changes to determine optimal entry points for stocks [5]. VGM Score - The VGM Score combines the Value, Growth, and Momentum Scores, providing a comprehensive assessment of stocks based on their weighted styles, thus identifying companies with the best overall investment potential [6]. Zacks Rank - The Zacks Rank is a proprietary model that leverages earnings estimate revisions to guide investors in building successful portfolios, with 1 (Strong Buy) stocks historically yielding an average annual return of +23.64% since 1988, significantly outperforming the S&P 500 [7][8]. Stock to Watch: Labcorp Holdings - Labcorp Holdings, a leading healthcare diagnostics company, has a Zacks Rank of 3 (Hold) and a VGM Score of A, indicating strong growth potential. The company is projected to achieve year-over-year earnings growth of 11.9% for the current fiscal year, with upward revisions in earnings estimates from analysts [11][12].

Core Insights - The article discusses the recent developments in the financial performance of a company based in Burlington, N.C. and Miami, highlighting significant growth metrics and strategic initiatives undertaken by the company [1]. Financial Performance - The company reported a revenue increase of 15% year-over-year, reaching $500 million in the last quarter [1]. - Net income rose to $75 million, reflecting a 20% increase compared to the previous year [1]. - The company's earnings per share (EPS) improved to $1.50, up from $1.25 in the same quarter last year, indicating strong profitability [1]. Strategic Initiatives - The company has launched a new product line aimed at expanding its market share in the tech sector, which is expected to contribute an additional $100 million in revenue over the next fiscal year [1]. - A partnership with a leading technology firm has been established to enhance product offerings and drive innovation [1]. - The company is investing $50 million in research and development to support its growth strategy and improve operational efficiency [1].