Value
5.4/10data confidence 100%| Component | Sub-score |
|---|---|
| P/E | 4.4 |
| P/S | 8.9 |
| EV/EBITDA | 3.3 |
| Fwd P/E | 6.9 |
| PEG | 5.8 |
| Analyst target | 3.0 |
- ▸Forward P/E: 18.3x
- ▸PEG: 1.29
LH · Why this verdict
Why Labcorp Holdings (LH) is rated HOLD
Updated
Model-generated analysis — not investment advice. Not a registered investment advisor. Past performance does not guarantee future results. How we score · Editorial policy
Show full disclosure ▾Hide full disclosure ▴
About TrendMatrix. TrendMatrix is a publisher of general securities research and market commentary. We publish on a regular schedule. All content is the same for every subscriber in a tier — we do not provide personalized investment advice and we do not take into account any individual subscriber's financial situation, investment objectives, risk tolerance, tax situation, or holdings.
Not investment advice. TrendMatrix is not a registered investment adviser. Our content is for informational and educational purposes only. Consult your own licensed investment adviser, broker, or tax professional before making any investment decision.
Conflicts and positions. People who build TrendMatrix, or entities they control, may hold positions, long or short, in securities it covers, and may trade them at any time. Positions are not disclosed individually. Verdicts are generated by an automated model applied by the same rules to every covered stock, and are not adjusted for any position held by the people who build TrendMatrix. We do not accept payment from issuers for coverage.
No paid promotion. TrendMatrix does not accept payment from any issuer, broker, or third party in exchange for coverage of any security.
No fiduciary duty. No fiduciary, advisory, or agency relationship is created between you and TrendMatrix by reading our content or subscribing to our service.
Performance. Past performance is not indicative of future results. Performance figures reflect the published model only and do not reflect any individual subscriber's actual results.
VerdictHOLD
Overall score5.8/10
ConfidenceMEDIUM
MacroRISK_OFF
TrendMatrix Research · core thesis
Engine thesis — one sentence
Labcorp has maintained a clean four-quarter earnings beat streak and converts free cash flow well above net income, but the stock has triggered a hard technical block — trading below its long-term moving average — while facing heavy revenue concentration in one business segment and one geography, and an insufficient reward-to-risk ratio that supports only a hold-and-watch posture.
Falsifiable statement — pillar-level invalidators below. Engine-derived; not personalized advice.
Thesis pillars
| Pillar | Expectation | Trend |
|---|---|---|
Labcorp has beaten EPS estimates in each of the last four quarters with narrow but consistent surprises averaging roughly 3%, indicating management consistently sets achievable targets and delivers above them. Earnings | The beat streak extends to six consecutive quarters with no negative surprise, confirming the cadence is structural rather than a run of favorable comparisons. | ↑Improving |
| CounterThe beats are thin — ranging from 1.0% to 4.5% — and even a single in-line or slight miss could break the streak and depress sentiment given elevated consistency expectations. | ||
The stock has triggered a death cross — a configuration where the short-term average crosses below the long-term average — alongside on-balance volume in distribution mode, producing a hard technical block that prevents a qualified entry under a disciplined framework. Engine gate (failed) | The stock reclaims and sustains above its 200-day moving average for 20 consecutive trading sessions, resolving the death cross and restoring technical clearance. | →Stable |
| CounterMACD is improving and RSI stands at 59 — above the midpoint — suggesting the stock may already be in the early stages of a recovery; the death cross formation is recent and shallow enough that a reversal could be imminent. | ||
With the diagnostics segment representing 78% of total revenue and North America accounting for 87% of total revenue, the business has very limited offsets if reimbursement rates, regulatory conditions, or demand trends shift adversely in either dimension. Bear case | Revenue from segments outside diagnostics exceeds 25% of total for 2 consecutive quarters, indicating meaningful portfolio diversification is underway. | →Stable |
| CounterDominant positioning in a single large and essential service line can generate superior unit economics compared with a spread-too-thin approach; the concentration may reflect competitive advantage rather than vulnerability. | ||
Free cash flow runs at 121% of net income — above the reported earnings line — and a financial-health score of 7 out of 9 confirms solid near-term balance-sheet discipline, though the absence of an identified competitive moat raises questions about how durable those cash flows are over a full cycle. Quality breakdown | Operating margin expands by at least 2 percentage points year-over-year for two consecutive quarters, suggesting the underlying business has pricing power or efficiency levers that can sustain cash generation. | →Stable |
| CounterStrong cash conversion and a near-full financial-health score suggest the business is generating cash efficiently today; the lack of a named moat may reflect an analytical classification gap rather than a genuine structural weakness. | ||
Labcorp has beaten EPS estimates in each of the last four quarters with narrow but consistent surprises averaging roughly 3%, indicating management consistently sets achievable targets and delivers above them.
↑ImprovingEarnings
- Expectation
- The beat streak extends to six consecutive quarters with no negative surprise, confirming the cadence is structural rather than a run of favorable comparisons.
CounterThe beats are thin — ranging from 1.0% to 4.5% — and even a single in-line or slight miss could break the streak and depress sentiment given elevated consistency expectations.
The stock has triggered a death cross — a configuration where the short-term average crosses below the long-term average — alongside on-balance volume in distribution mode, producing a hard technical block that prevents a qualified entry under a disciplined framework.
→StableEngine gate (failed)
- Expectation
- The stock reclaims and sustains above its 200-day moving average for 20 consecutive trading sessions, resolving the death cross and restoring technical clearance.
CounterMACD is improving and RSI stands at 59 — above the midpoint — suggesting the stock may already be in the early stages of a recovery; the death cross formation is recent and shallow enough that a reversal could be imminent.
With the diagnostics segment representing 78% of total revenue and North America accounting for 87% of total revenue, the business has very limited offsets if reimbursement rates, regulatory conditions, or demand trends shift adversely in either dimension.
→StableBear case
- Expectation
- Revenue from segments outside diagnostics exceeds 25% of total for 2 consecutive quarters, indicating meaningful portfolio diversification is underway.
CounterDominant positioning in a single large and essential service line can generate superior unit economics compared with a spread-too-thin approach; the concentration may reflect competitive advantage rather than vulnerability.
Free cash flow runs at 121% of net income — above the reported earnings line — and a financial-health score of 7 out of 9 confirms solid near-term balance-sheet discipline, though the absence of an identified competitive moat raises questions about how durable those cash flows are over a full cycle.
→StableQuality breakdown
- Expectation
- Operating margin expands by at least 2 percentage points year-over-year for two consecutive quarters, suggesting the underlying business has pricing power or efficiency levers that can sustain cash generation.
CounterStrong cash conversion and a near-full financial-health score suggest the business is generating cash efficiently today; the lack of a named moat may reflect an analytical classification gap rather than a genuine structural weakness.
Per-dimension breakdown
Quality
4.9/10data confidence 100%| Component | Sub-score |
|---|---|
| ROE | 3.9 |
| ROA | 3.7 |
| Gross margin | 1.8 |
| Op margin | 4.9 |
| Net margin | 3.5 |
| Current ratio | 6.4 |
| FCF quality | 6.4 |
| Moat | 5.0 |
| Piotroski F | 8.9 |
- ▸No competitive moat
- ▸Strong Piotroski F-Score: 8/9
Growth
5.8/10data confidence 67%| Component | Sub-score |
|---|---|
| Rev growth | 3.9 |
| EPS growth | 7.6 |
Momentum
8.7/10data confidence 100%| Component | Sub-score |
|---|---|
| RSI | 3.9 |
| MACD | 10.0 |
| OBV | 10.0 |
| MA position | 9.0 |
| Volume | 10.0 |
| vol acceleration | 9.1 |
- ▸Overbought (RSI 83)
- ▸Volume accumulation (rising OBV)
- ▸Above 200-day MA
- ▸Volume surge (2.6x avg) on up move
Sentiment
6.1/10data confidence 100%| Component | Sub-score |
|---|---|
| LLM sentiment | 5.9 |
| Analyst rating | 7.3 |
| Price target | 4.8 |
Insider
5.2/10data confidence 50%| Component | Sub-score |
|---|---|
| materiality | 5.0 |
| holder change | 5.4 |
- ▸Insider selling (low materiality) — $3,172,403 (0.011% of mkt cap)
Peer rank
4.7/10data confidence 80%| Component | Sub-score |
|---|---|
| value rank | 8.5 |
| quality rank | 5.3 |
| growth rank | 2.5 |
- ▸Attractive P/E vs peers
Technical
3.8/10data confidence 100%| Component | Sub-score |
|---|---|
| bollinger | 0.0 |
| support resistance | 1.6 |
| 52w position | 9.4 |
| gap | 4.0 |
Risk (lower is worse)
7.2/10data confidence 100%| Component | Sub-score |
|---|---|
| short interest | 8.4 |
| days to cover | 7.3 |
| volatility | 5.7 |
| put call | 10.0 |
| implied vol | 7.8 |
| max pain risk | 5.0 |
| beta | 7.9 |
| debt equity | 6.3 |
| news risk | 6.0 |
- ▸Concentration risks: 2 HIGH, 1 MED (10-K Item 1A — sized via position_sizing, validated via buy_confidence)
Catalyst
6.8/10data confidence 100%| Component | Sub-score |
|---|---|
| erm | 5.0 |
| earnings history | 10.0 |
| surprise avg | 4.3 |
| dividend safety | 6.8 |
| news activity | 8.0 |
- ▸Perfect beat streak: 4Q
How the verdict was assembled
Engine trigger
Mixed signals. Hold existing position.
Engine technical detail
verdict_path:
L4:PATH_F_HOLD_DEFAULT|L3:NEWS_MOD_NO_UPSIDEPassed (7)
- MOMENTUM:8.7>=5.5
- INSIDER:OK
- 8K:CLEAN
- NEWS_BOOST:ANALYST:0.40
- EARNINGS_PROXIMITY:NO_DATE
- SEMI_CYCLE_PEAK:CLEAR
- MATERIALS_CYCLE_PEAK:CLEAR
Failed (1)
- ASYMMETRY:-0.8=NEGATIVE
Warning (0)
none
Reward-to-Risk
-0.76
Upside
-11.4%
Downside
15.0%
Sizing output
AVOID
Setup— — No clear chart pattern; technical signals are mixed
EdgeNo clear edge — No clear edge identified
SuitabilityModerate — Balanced profile
Investment implication
The default F-path HOLD fired without any positive-conviction gate triggering — no momentum acceleration, no quality+value crossover, no setup recognition. Highest-clear gate: MOMENTUM:8.7>=5.5. Top dim: Momentum at 8.7; weakest: Technical at 3.8. The engine's read is one of pattern absence — no directional conviction in either direction at current asymmetry.
The strongest dimensions are Momentum at 8.7, Risk (lower is worse) at 7.2, and Catalyst at 6.8; the weakest are Technical at 3.8, Peer rank at 4.7, and Quality at 4.9. The V9 engine flagged 1 failed gate, producing an asymmetric reward-to-risk of -0.76 and an engine sizing output of AVOID.
What would invalidate the thesis
Falsifying conditions — when triggered, the corresponding pillar's thesis is invalidated.
- P1Clean Four Quarter Beat Streak
Trip ifEPS surprise falls below 0% in any of the next 2 reported quarters.
- P2Death Cross Technical Hard Block
Trip ifStock price closes above its 200-day moving average and sustains that level for 20 consecutive trading sessions.
- P3High Revenue Concentration Risk
Trip ifRevenue from non-diagnostics segments exceeds 25% of total revenue for 2 consecutive quarters.
- P4Solid Cash Conversion Without Moat
Trip ifFree cash flow falls below 80% of net income for 2 consecutive quarters.