Laboratory Corp of America Holdings

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LH : NYSE : Health Care
$152.85 -0.9 | -0.59%
Today's Range: 152.43 - 154.31
Avg. Daily Volume: 669500.0
09/19/17 - 4:02 PM ET

Financial Analysis


LABORATORY CP OF AMER HLDGS's gross profit margin for the second quarter of its fiscal year 2017 is essentially unchanged when compared to the same period a year ago. Even though sales increased, the net income has decreased. LABORATORY CP OF AMER HLDGS has average liquidity. Currently, the Quick Ratio is 1.07 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, indicating deteriorating cash flow.

During the same period, stockholders' equity ("net worth") has increased by 10.63% 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 FY17 Q2 FY16
Net Sales ($mil)2542.92430.7
EBITDA ($mil)512.9505.4
EBIT ($mil)385.9380.0
Net Income ($mil)188.6204.1


Balance Sheet Q2 FY17 Q2 FY16
Cash & Equiv. ($mil)299.9639.6
Total Assets ($mil)14902.514199.0
Total Debt ($mil)6127.96055.0
Equity ($mil)5878.15313.0


Profitability Q2 FY17 Q2 FY16
Gross Profit Margin36.8637.31
EBITDA Margin20.1620.79
Operating Margin15.1815.63
Sales Turnover0.660.66
Return on Assets4.994.45
Return on Equity12.6611.91
Debt Q2 FY17 Q2 FY16
Current Ratio1.392.08
Debt/Capital0.510.53
Interest Expense55.053.5
Interest Coverage7.027.1


Share Data Q2 FY17 Q2 FY16
Shares outstanding (mil)102.0102.2
Div / share0.00.0
EPS1.821.96
Book value / share57.6351.99
Institutional Own % n/a n/a
Avg Daily Volume660645.0699412.0

Valuation


BUY. This stock's P/E ratio indicates a discount compared to an average of 23.80 for the Health Care Providers & Services industry and a discount compared to the S&P 500 average of 24.88. For additional comparison, its price-to-book ratio of 2.67 indicates a discount versus the S&P 500 average of 3.10 and a discount versus the industry average of 3.33. The price-to-sales ratio is well below the S&P 500 average, but well above the industry average. 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 21.64 Peers 23.80   LH 12.61 Peers 11.90

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 14.68 Peers 16.92   LH 0.60 Peers 0.71

Average. An average price-to-projected earnings ratio can signify an industry neutral stock price and average future growth expectations.

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

 
Price/Book
1 2 3 4 5
premium   discount
  Earnings Growth
1 2 3 4 5
lower   higher
LH 2.67 Peers 3.33   LH 16.53 Peers 20.55

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 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 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 1.60 Peers 0.92   LH 4.42 Peers 8.42

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.

 

Lower. A sales growth rate that trails the industry implies that a company is losing market share.

LH significantly trails its peers on the basis of sales growth

 

 

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