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LabCorp (LH) Stock Sinks As Market Gains: What You Should Know

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LabCorp (LH - Free Report) closed the most recent trading day at $276.08, moving -0.62% from the previous trading session. This change lagged the S&P 500's 0.08% gain on the day. At the same time, the Dow lost 0.56%, and the tech-heavy Nasdaq lost 0.42%.

Prior to today's trading, shares of the medical laboratory operator had lost 10.42% over the past month. This has lagged the Medical sector's loss of 4.1% and the S&P 500's gain of 0.22% in that time.

LabCorp will be looking to display strength as it nears its next earnings release, which is expected to be February 10, 2022. On that day, LabCorp is projected to report earnings of $5.83 per share, which would represent a year-over-year decline of 44.79%. Meanwhile, our latest consensus estimate is calling for revenue of $3.9 billion, down 13.16% from the prior-year quarter.

Investors should also note any recent changes to analyst estimates for LabCorp. These revisions typically reflect the latest short-term business trends, which can change frequently. As a result, we can interpret positive estimate revisions as a good sign for the company's business outlook.

Our research shows that these estimate changes are directly correlated with near-term stock prices. Investors can capitalize on this by using the Zacks Rank. This model considers these estimate changes and provides a simple, actionable rating system.

Ranging from #1 (Strong Buy) to #5 (Strong Sell), the Zacks Rank system has a proven, outside-audited track record of outperformance, with #1 stocks returning an average of +25% annually since 1988. Within the past 30 days, our consensus EPS projection has moved 6.08% higher. LabCorp is currently a Zacks Rank #1 (Strong Buy).

Investors should also note LabCorp's current valuation metrics, including its Forward P/E ratio of 14.96. Its industry sports an average Forward P/E of 19.85, so we one might conclude that LabCorp is trading at a discount comparatively.

Meanwhile, LH's PEG ratio is currently 1.42. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. The Medical - Dental Supplies industry currently had an average PEG ratio of 1.58 as of yesterday's close.

The Medical - Dental Supplies industry is part of the Medical sector. This group has a Zacks Industry Rank of 73, putting it in the top 29% of all 250+ industries.

The Zacks Industry Rank gauges the strength of our industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

You can find more information on all of these metrics, and much more, on Zacks.com.


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