🐂 Not all bull runs are created equal. November’s AI picks include 5 stocks up +20% eachUnlock Stocks

Laboratory Corp shares target raised, keeps Outperform on recent updates

EditorNatashya Angelica
Published 07/08/2024, 12:37 PM
LH
-

On Monday, Baird maintained its Outperform rating on shares of Laboratory Corporation of America (NYSE:LH), while slightly increasing the stock's price target from $258.00 to $261.00. The adjustment follows a period of limited news since the last update on June 20, after a tour of the Central Lab in Indianapolis and recent updates in the Lab and CRO sectors.

The firm's analyst highlighted that the current market sentiment towards Laboratory Corporation of America may be unduly harsh due to a few minor issues. These issues were described as either transient or based on sentiment rather than fundamental business performance.

The analyst emphasized that the market is not fully accounting for the company's potential beyond 2025 or the favorable risk/reward ratio given its current low valuation.

In other recent news, Labcorp delivered a robust performance in Q1 2024, reporting total revenue of $3.2 billion and adjusted earnings per share of $3.68, marking a 7% increase from the previous year. The company also announced the acquisition of selected assets from Invitae (OTC:NVTAQ), a move expected to enhance Labcorp's specialty testing capabilities, particularly in oncology and rare diseases.

The acquisition, valued at $239 million, is approved by the United States Bankruptcy Court and is projected to contribute $275 million to $300 million to Labcorp's annual revenue.

In line with its global aspirations, Labcorp plans to establish a new holding company, Labcorp Holdings Inc. The company expects full-year enterprise revenue to grow by 4.8% to 6.4%, with diagnostics and biopharma revenue also projected to increase.

Still, decreased operating cash flow from continuing operations and challenges in the early development segment within the Biopharma Laboratory Services were also noted.

Analysts at Baird have raised Labcorp's target price from $256 to $258 following a detailed valuation analysis. The 'Outperform' rating on the stock remains unchanged. Risks identified by the analysts include potential regulatory changes, the impact of COVID-19 on testing volumes, and cybersecurity incidents, among others. These recent developments highlight Labcorp's strategic growth and financial performance.

This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.

Latest comments

Risk Disclosure: Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.
© 2007-2024 - Fusion Media Limited. All Rights Reserved.