LABCORP HOLDINGS INC (LH) Stock Fundamental Analysis
USA - New York Stock Exchange - NYSE:LH - US5049221055 - Common Stock
271.12 USD
+3.74 (+1.4%)
271.12 USD
0 (0%)
We assign a fundamental rating of 5 out of 10 to LH. LH was compared to 103 industry peers in the Health Care Providers & Services industry. LH has an average financial health and profitability rating. LH has a decent growth rate and is not valued too expensively.
1. Profitability
1.1 Basic Checks
- LH had positive earnings in the past year.
- In the past year LH had a positive cash flow from operations.
- In the past 5 years LH has always been profitable.
- LH had a positive operating cash flow in each of the past 5 years.
1.2 Ratios
- LH has a better Return On Assets (4.68%) than 74.76% of its industry peers.
- With a decent Return On Equity value of 9.83%, LH is doing good in the industry, outperforming 70.87% of the companies in the same industry.
- LH has a better Return On Invested Capital (6.32%) than 64.08% of its industry peers.
- The Average Return On Invested Capital over the past 3 years for LH is below the industry average of 9.21%.
- The 3 year average ROIC (6.31%) for LH is below the current ROIC(6.32%), indicating increased profibility in the last year.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 4.68% | ||
| ROE | 9.83% | ||
| ROIC | 6.32% |
ROA(3y)4.3%
ROA(5y)6.46%
ROE(3y)9.08%
ROE(5y)13.4%
ROIC(3y)6.31%
ROIC(5y)8.87%
1.3 Margins
- LH's Profit Margin of 6.21% is amongst the best of the industry. LH outperforms 82.52% of its industry peers.
- In the last couple of years the Profit Margin of LH has declined.
- LH has a better Operating Margin (9.92%) than 79.61% of its industry peers.
- LH's Operating Margin has declined in the last couple of years.
- With a Gross Margin value of 28.45%, LH perfoms like the industry average, outperforming 58.25% of the companies in the same industry.
- In the last couple of years the Gross Margin of LH has remained more or less at the same level.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 9.92% | ||
| PM (TTM) | 6.21% | ||
| GM | 28.45% |
OM growth 3Y-27.95%
OM growth 5Y-7.41%
PM growth 3Y-31.82%
PM growth 5Y-4.26%
GM growth 3Y-9.83%
GM growth 5Y-0.21%
2. Health
2.1 Basic Checks
- The Return on Invested Capital (ROIC) is below the Cost of Capital (WACC), so LH is destroying value.
- Compared to 1 year ago, LH has less shares outstanding
- The number of shares outstanding for LH has been reduced compared to 5 years ago.
- The debt/assets ratio for LH is higher compared to a year ago.
2.2 Solvency
- LH has an Altman-Z score of 3.15. This indicates that LH is financially healthy and has little risk of bankruptcy at the moment.
- With a decent Altman-Z score value of 3.15, LH is doing good in the industry, outperforming 66.02% of the companies in the same industry.
- LH has a debt to FCF ratio of 4.09. This is a neutral value as LH would need 4.09 years to pay back of all of its debts.
- LH has a Debt to FCF ratio of 4.09. This is in the better half of the industry: LH outperforms 69.90% of its industry peers.
- LH has a Debt/Equity ratio of 0.59. This is a neutral value indicating LH is somewhat dependend on debt financing.
- With a Debt to Equity ratio value of 0.59, LH perfoms like the industry average, outperforming 58.25% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.59 | ||
| Debt/FCF | 4.09 | ||
| Altman-Z | 3.15 |
ROIC/WACC0.76
WACC8.29%
2.3 Liquidity
- A Current Ratio of 1.55 indicates that LH should not have too much problems paying its short term obligations.
- The Current ratio of LH (1.55) is comparable to the rest of the industry.
- A Quick Ratio of 1.35 indicates that LH should not have too much problems paying its short term obligations.
- LH's Quick ratio of 1.35 is in line compared to the rest of the industry. LH outperforms 55.34% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.55 | ||
| Quick Ratio | 1.35 |
3. Growth
3.1 Past
- LH shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 9.71%, which is quite good.
- LH shows a small growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 5.20% yearly.
- Looking at the last year, LH shows a quite strong growth in Revenue. The Revenue has grown by 8.28% in the last year.
- The Revenue has been growing slightly by 2.40% on average over the past years.
EPS 1Y (TTM)9.71%
EPS 3Y-20.05%
EPS 5Y5.2%
EPS Q2Q%19.43%
Revenue 1Y (TTM)8.28%
Revenue growth 3Y-0.32%
Revenue growth 5Y2.4%
Sales Q2Q%8.58%
3.2 Future
- LH is expected to show a small growth in Earnings Per Share. In the coming years, the EPS will grow by 7.93% yearly.
- The Revenue is expected to grow by 4.05% on average over the next years.
EPS Next Y15.38%
EPS Next 2Y11.22%
EPS Next 3Y10.52%
EPS Next 5Y7.93%
Revenue Next Year7.75%
Revenue Next 2Y6.1%
Revenue Next 3Y5.71%
Revenue Next 5Y4.05%
3.3 Evolution
- The EPS growth rate is accelerating: in the next years the growth will be better than in the last years.
- The Revenue growth rate is accelerating: in the next years the growth will be better than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
- A Price/Earnings ratio of 17.14 indicates a rather expensive valuation of LH.
- Compared to the rest of the industry, the Price/Earnings ratio of LH indicates a rather cheap valuation: LH is cheaper than 80.58% of the companies listed in the same industry.
- The average S&P500 Price/Earnings ratio is at 28.87. LH is valued slightly cheaper when compared to this.
- A Price/Forward Earnings ratio of 15.04 indicates a correct valuation of LH.
- Based on the Price/Forward Earnings ratio, LH is valued a bit cheaper than 79.61% of the companies in the same industry.
- LH's Price/Forward Earnings ratio indicates a valuation a bit cheaper than the S&P500 average which is at 25.96.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 17.14 | ||
| Fwd PE | 15.04 |
4.2 Price Multiples
- LH's Enterprise Value to EBITDA ratio is a bit cheaper when compared to the industry. LH is cheaper than 63.11% of the companies in the same industry.
- LH's Price/Free Cash Flow ratio is a bit cheaper when compared to the industry. LH is cheaper than 75.73% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 16.28 | ||
| EV/EBITDA | 14.27 |
4.3 Compensation for Growth
- The PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a correct valuation of the company.
- The decent profitability rating of LH may justify a higher PE ratio.
PEG (NY)1.11
PEG (5Y)3.3
EPS Next 2Y11.22%
EPS Next 3Y10.52%
5. Dividend
5.1 Amount
- With a Yearly Dividend Yield of 1.07%, LH has a reasonable but not impressive dividend return.
- LH's Dividend Yield is rather good when compared to the industry average which is at 0.45. LH pays more dividend than 86.41% of the companies in the same industry.
- With a Dividend Yield of 1.07, LH pays less dividend than the S&P500 average, which is at 1.82.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.07% |
5.2 History
- On average, the dividend of LH grows each year by 96.38%, which is quite nice.
- LH has been paying a dividend for over 5 years, so it has already some track record.
- The dividend of LH decreased in the last 3 years.
Dividend Growth(5Y)96.38%
Div Incr Years2
Div Non Decr Years2
5.3 Sustainability
- LH pays out 28.24% of its income as dividend. This is a sustainable payout ratio.
- LH's earnings are growing slower than its dividend. This means the dividend growth is not sustainable.
DP28.24%
EPS Next 2Y11.22%
EPS Next 3Y10.52%
LABCORP HOLDINGS INC / LH FAQ
What is the ChartMill fundamental rating of LABCORP HOLDINGS INC (LH) stock?
ChartMill assigns a fundamental rating of 5 / 10 to LH.
What is the valuation status for LH stock?
ChartMill assigns a valuation rating of 5 / 10 to LABCORP HOLDINGS INC (LH). This can be considered as Fairly Valued.
What is the profitability of LH stock?
LABCORP HOLDINGS INC (LH) has a profitability rating of 6 / 10.
What is the valuation of LABCORP HOLDINGS INC based on its PE and PB ratios?
The Price/Earnings (PE) ratio for LABCORP HOLDINGS INC (LH) is 17.14 and the Price/Book (PB) ratio is 2.58.
What is the expected EPS growth for LABCORP HOLDINGS INC (LH) stock?
The Earnings per Share (EPS) of LABCORP HOLDINGS INC (LH) is expected to grow by 15.38% in the next year.