Quality Investor

Labcorp Holdings Inc.

Rank #329Capital Return

LH · NYSE · Healthcare

Labcorp Holdings Inc. (LH) — Rank #329 by gross profitability (GP/assets 0.22) · ROE 10.2% · Piotroski F-Score 8 / 9.

As-of 2026-09-15 · CIK 0000920148 · all metrics point-in-time as of the filing date.

About

Labcorp Holdings Inc. provides laboratory services.

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It operates in Diagnostics Laboratories and Biopharma Laboratory Services segments. The company offers various tests, such as blood chemistry analyses, urinalyses, blood cell counts, thyroid tests, PAP tests, hemoglobin A1C, PSA, tests for sexually transmitted diseases, vitamin D testing, microbiology cultures and procedures, and alcohol and other substance abuse tests. It also provides specialty testing services comprising gene-based and esoteric testing; advanced tests target specific diseases; services related to anatomic pathology/oncology, cardiovascular disease, coagulation, diagnostic genetics, endocrinology, infectious disease, women's health, pharmacogenetics, parentage and donor testing, occupational testing service, medical drug monitoring services, chronic disease programs, and kidney stone prevention tests; and health and wellness services to employers and managed care organizations. In addition, it offers digital pathology solutions, a pathology platforms that support the digitization, centralized review, and sharing of pathology slides; provider and payer digital platforms, an online applications for providers, MCOs, and ACOs; online and mobile applications that enable patients to check offerings, schedule PSC visits, check-in upon PSC arrival, complete documentation, access tests and test results, and manage their accounts; and Generative AI enabled Test Selection, a generative AI enabled tool. It serves clients, third party, medicare/medicaid, patients, pharmaceutical, biotechnology, medical device, diagnostic companies, and CROs. It has a strategic collaboration with the Children's Hospital of Philadelphia to accelerate the discovery, development, and availability of pediatric diagnostics; a strategic alliance with the National Association of Community Health Centers to support current and emerging clinical leaders through the NACHC Leadership Exchange for Chief Medical Officers; and Alliance for Clinical Trials in Oncology to advance national clinical trial for patients diagnosed with colorectal cancer.

The company was founded in 1995 and is headquartered in Burlington, North Carolina.

Industry
Diagnostics & Research
Sector
Healthcare
Filer Category
Large accelerated filer
Fiscal Year End
December 31

Price History

LH+24.7% · +4.5% CAGRSPY+80.5% · +12.5% CAGR

Company Snapshot

P/E and reverse DCF are the primary valuation lenses at this stage.

Market Cap

$25.91B

P/E (annual)

30.5

P/S (annual)

1.9

P/B

3.0

P/OCF (annual)

15.8

Shareholder Yield

1.6%

Employees

71,000

Industry

Diagnostics & Research

Exchange

NYSE

Signal Flags

4 green
Revenue growth acceleratingGrowth rate increasing year over year
Operating leverage expandingOperating income growing faster than revenue
Deferred revenue growingRevenue and deferred revenue both growing — retention signal
Sequential beat (rev + EPS)Both revenue and EPS exceeded prior quarter — 2-quarter streak

Quality Profile

Profitability

1/1 pass
GP / assets
0.22
Return on equity
10.2%
Gross margin trend
PASS

Safety

1/1 pass
Balance-sheet safety
PASS
Debt / equity
1.15
Current ratio
1.80×
Net cash
-$5.72B

Cash Flow

3/3 pass
Positive FCF
PASS
Cash-backed earnings
PASS
Accruals healthy
PASS
SBC / revenue
0.9%

Growth

2/2 pass
Revenue growth
7.2%
Piotroski F-Score
8 / 9
Share dilution
-0.7%

Terry Smith quality gate

Passes 1/5 Terry Smith thresholds

What Growth Is Priced In

Implied revenue growth (10Y)

9.1%

incredible deal

The annual FCF growth rate today's price requires over a 10-year horizon (discount rate 10%, terminal growth 2.5%).

Buyback tailwind: -0.7% — per-share value needs a total required return of 8.4% once share-count change is priced in.

vs. own 6-year median revenue growth: 7.1%

within its own history

Cost-of-equity sensitivity (implied growth at different discount rates)

r = 8%

4.7%

r = 10% (base)

9.1%

r = 12%

12.9%

Net debt / market cap: 21.4%

Base FCF: $1.2B3Y mean FCF: $1.1B

Valuation History

Current multiple vs historical range at each filing date. Band spans 25th-75th percentile.

P / E

Price / diluted EPS

27.5xExpensive
9.7xmed 16.1x45.2x

P / S

Price / revenue per share

1.7xExpensive
1.2xmed 1.4x1.7x

P / B

Price / book value per share

2.8xExpensive
1.9xmed 2.3x2.8x

P / GP

Price / gross profit per share

6.0xExpensive
4.0xmed 4.4x6.0x

P / FCF

Price / free cash flow per share

20.0xExpensive
8.7xmed 14.2x21.6x

FCF yield, shareholder yield, and buyback activity are the primary reads at this stage.

Profitability

Gross profitability (GP / assets)

0.22

Primary signal (Novy-Marx).

8th of 8 SIC 80 peers

Return on equity

10.2%

Gross margin

28.8%

6th of 8 SIC 80 peers

Revenue growth (YoY)

7.2%

Gross margin improving

Margin trend vs prior year.

PASS

Operating Leverage

2022202320242025
Revenue vs COGS
Revenue vs OpEx
Op. Income vs Revenue

Growth

Revenue CAGR (3Y)

5.6%

Revenue CAGR (5Y)

-0.0%

Earnings CAGR (3Y)

-11.8%

FCF CAGR (3Y)

-6.5%

Anti-fragile safety

Balance-sheet safety

Composite anti-fragile check.

PASS

Debt / equity

1.15

6th of 7 SIC 80 peers (best = lowest)

Current ratio

1.80×

6th of 8 SIC 80 peers

Quick ratio

1.17×

Net cash

-$5.72B

Cash & equivalents minus total debt.

Cash-flow health

Free cash flow

$1.21B

Operating cash flow minus capex.

Positive free cash flow

PASS

FCF / net income

0.38

Cash-backing of earnings.

FCF/NI divergence

Unfavorable divergence (yellow flag).

PASS

Accruals healthy

Cash-backed earnings.

PASS

SBC / revenue

0.9%

Stock-based comp intensity.

Dividend safety

Composite score

3.2 / 5

Good
Payout ratio
27.5%5/5 Strong
FCF coverage
5.01×5/5 Strong
Dividend growth streak
0 yr0/5 Weak
Balance-sheet health
D/E 1.15 · IC 6.18×3/5 Good

Piotroski F-Score

F-Score

8 / 9

Fundamental-strength score (0-9).

Lifecycle Phase History

20202025
Hypergrowth
Op. Leverage
Decline
Capital Return