Is Labcorp Holdings Inc. (LH) overvalued?
On Equity Rank's model estimate, LH trades close to its fair value (10% below it). Labcorp Holdings Inc. (LH) last closed at $366.57; the multi-method model fair value is $406.15.
| Price | Model fair value | Price vs model |
|---|---|---|
| $366.57 | $406.15 | 10% below |
What the answer rests on
- 3 of 12 valuation methods put LH's value above its price and 9 put it below, so the methods mostly agree.
- To justify today's price, LH's free cash flow would need to grow about 7.9% a year for ten years (a reverse discounted cash flow). Over the last three years it actually grew -6.5% a year.
- LH trades at 30.1 times its last year's earnings, against a median of 38.3 for 26 profitable Life Sciences Tools companies.
- Over the past year the price sat below the model fair value on 100% of trading days. The gap ranged from 30% below to 7% below the model fair value.
Read this before relying on it
The model fair value is an estimate from published financial statements. It is not a forecast of where the price goes, and it can be wrong. Within 10% either side we call it close to fair value: valuation models are not precise enough to read more into a smaller gap. Our own lists have no proven edge over the market yet; the live record shows every result, misses included.
Every valuation method behind LH's fair value · What prices assume · Other companies