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Laboratory Corp of America Hldgs
LH : NYSE : Health Care
$127.29 | %
Today's Range: 125.89 - 127.99
Avg. Daily Volume: 1,134,100
07/31/15 - 4:00 PM ET

Financial Analysis


LABORATORY CP OF AMER HLDGS's gross profit margin for the second quarter of its fiscal year 2015 has decreased when compared to the same period a year ago. The company managed to grow both sales and net income at a faster pace than the average competitor in its industry this quarter as compared to the same quarter a year ago. LABORATORY CP OF AMER HLDGS has average liquidity. Currently, the Quick Ratio is 1.09 which shows that technically this company has the ability to cover short-term cash needs. The company's liquidity has decreased from the same period last year.

At the same time, stockholders' equity ("net worth") has greatly increased by 79.55% from the same quarter last year. Together, the key liquidity measurements indicate that it is relatively unlikely that the company will face financial difficulties in the near future.

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Income Statement Q2 FY15 Q2 FY14
Net Sales ($mil)2269.11516.4
EBITDA ($mil)460.7316.2
EBIT ($mil)341.5253.4
Net Income ($mil)168.4141.3


Balance Sheet Q2 FY15 Q2 FY14
Cash & Equiv. ($mil)619.0479.5
Total Assets ($mil)14465.27144.8
Total Debt ($mil)6787.33007.5
Equity ($mil)4769.72656.4


Profitability Q2 FY15 Q2 FY14
Gross Profit Margin37.3440.19
EBITDA Margin20.320.85
Operating Margin15.0516.71
Sales Turnover0.490.82
Return on Assets2.947.4
Return on Equity8.9419.91
Debt Q2 FY15 Q2 FY14
Current Ratio1.422.11
Debt/Capital0.590.53
Interest Expense57.925.8
Interest Coverage5.99.82


Share Data Q2 FY15 Q2 FY14
Shares outstanding (mil)100.584.9
Div / share0.00.0
EPS1.641.64
Book value / share47.4631.29
Institutional Own % n/a n/a
Avg Daily Volume1138251.01137338.0

Valuation


BUY. The current P/E ratio indicates a discount compared to an average of 28.80 for the Health Care Providers & Services industry and a premium compared to the S&P 500 average of 21.25. To use another comparison, its price-to-book ratio of 2.65 indicates valuation on par with the S&P 500 average of 2.83 and a discount versus the industry average of 3.86. The price-to-sales ratio is similar to the S&P 500 average, but it is significantly above the industry average, indicating a premium. Upon assessment of these and other key valuation criteria, LABORATORY CP OF AMER HLDGS proves to trade at a discount to investment alternatives within the industry.


Price/Earnings
1 2 3 4 5
premium   discount
  Price/Cash Flow
1 2 3 4 5
premium   discount
LH 27.13 Peers 28.80   LH 16.32 Peers 17.62

Average. An average P/E ratio can signify an industry neutral price for a stock and an average growth expectation.

LH is trading at a valuation on par with its peers.

 

Average. The P/CF ratio, a stock’s price divided by the company's cash flow from operations, is useful for comparing companies with different capital requirements or financing structures.

LH is trading at a valuation on par to its peers.

 
Price/Projected
Earnings
1 2 3 4 5
premium   discount
  Price to
Earnings/Growth
1 2 3 4 5
premium   discount
LH 14.35 Peers 19.92   LH 0.81 Peers 1.73

Discount. A lower price-to-projected earnings ratio than its peers can signify a less expensive stock or lower future growth expectations.

LH is trading at a discount to its peers.

 

Discount. The PEG ratio is the stock’s P/E divided by the consensus estimate of long-term earnings growth. Faster growth can justify higher price multiples.

LH trades at a significant discount to its peers.

 
Price/Book
1 2 3 4 5
premium   discount
  Earnings Growth
1 2 3 4 5
lower   higher
LH 2.65 Peers 3.86   LH -22.97 Peers 54.04

Discount. A lower price-to-book ratio makes a stock more attractive to investors seeking stocks with lower market values per dollar of equity on the balance sheet.

LH is trading at a significant discount to its peers.

 

Lower. Elevated earnings growth rates can lead to capital appreciation and justify higher price-to-earnings ratios.

However, LH is expected to significantly trail its peers on the basis of its earnings growth rate.

 
Price/Sales
1 2 3 4 5
premium   discount
  Sales Growth
1 2 3 4 5
premium   discount
LH 1.77 Peers 0.91   LH 21.90 Peers 15.83

Premium. In the absence of P/E and P/B multiples, the price-to-sales ratio can display the value investors are placing on each dollar of sales.

LH is trading at a significant premium to its industry.

 

Higher. A sales growth rate that exceeds the industry implies that a company is gaining market share.

LH has a sales growth rate that significantly exceeds its peers.

 

 

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