Yahoo Finance LabCorp (LH) Expands Laboratory Relationship With New Pact
Laboratory Corporation of America Holdings, Inc. or LabCorp LH recently signed an agreement with Providence to strengthen their long-standing strategic partnership by acquiring select assets of Providence Oregon's outreach laboratory business. The transaction is likely to close later in 2023, subject to customary closing conditions and applicable regulatory approvals.
The latest move will strengthen LabCorp’s business.
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The more than 20-year partnership between LabCorp and the Providence family of companies will be strengthened by this acquisition. LabCorp provides reference testing for sites across numerous states used by Providence in the western United States and laboratory services to several Providence affiliated medical facilities.
Per the deal, LabCorp will buy Providence Oregon's outreach laboratory business and a few Oregon-based assets. Anatomic pathology, genomics outreach testing and Providence Oregon's hospital laboratories will continue to be run and owned by the company.
Strategic Efforts
By deepening the partnership with Providence, LabCorp expand healthcare access, offer advanced diagnostic tools and guarantee that patients and doctors can afford the treatments they get. To help patients and providers improve their health and quality of life, LabCorp is committed to building on Providence Oregon's legacy of outstanding work and expanding LabCorp's presence in the neighbourhood.
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Patients and doctors will continue to have access to Providence Oregon facilities once the acquisition is completed and gain from LabCorp's testing and scientific capabilities. The commitment of LabCorp to the Providence Oregon community, including its patients, staff and health plan subscribers, will grow as a result of this acquisition.
Industry Prospects
Per a report by Grand View Research, the global clinical laboratory service market size was estimated at $217.53 billion in 2022 and is expected to expand at a CAGR of 3.2% by 2030. Factors such increasing burden of chronic diseases and the growing demand for early diagnostic tests are driving the market.
Other Notable Partnerships
In May 2023, LabCorp signed an agreement to enter into a strategic relationship with Jefferson Health — the largest health system serving the greater Philadelphia area and Southern New Jersey. Upon completion, the partnership between Jefferson and LabCorp will serve to build academic collaborations around teaching and the development of innovative tests.
In April 2023, LabCorp partnered with the Conference of National Black Churches (CNBC) to tackle health equity gaps in colorectal cancer screening. Through partnership, the companies will distribute screening kits to communities at higher risk of colon cancer. The partnership will increase access to testing options in urban and rural communities and will help LabCorp’s commitment to align health equity with its mission of helping the communities.
Price Performance
Shares of the company have lost 10.2% in a year compared with the industry’s rise of 10.4%.
Zacks Rank & Other Key Picks
LabCorp currently carries a Zacks Rank #3 (Hold).
Some better-ranked stocks in the broader medical space are Addus Homecare Corporation ADUS, Merit Medical Systems, Inc. MMSI and Davita Inc DVA.
The Zacks Consensus Estimate for Addus Homecare’s 2023 earnings indicates 10.9% year-over-year growth. The Zacks Consensus Estimate for ADUS’s 2023 earnings has moved 0.5% north in the past 30 days.
Addus Homecare has a long-term estimated growth rate of 11.8%. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Merit Medical reported a first-quarter 2023 adjusted EPS of 64 cents, beating the Zacks Consensus Estimate by 16.4%. Revenues of $297.6 million surpassed the Zacks Consensus Estimate by 5.9%. It currently carries a Zacks Rank #2.
Merit Medical has a long-term estimated growth rate of 11%. MMSI’s earnings surpassed estimates in all the trailing four quarters, the average surprise being 20.2%.
DaVita, carrying a Zacks Rank #2 at present, has a long-term estimated growth rate of 14.6%. DVA’s earnings surpassed estimates in three of the trailing four quarters and missed in one, the average surprise being 17.3%.
DaVita has lost 1.9% compared with the industry’s 18% decline over the past year.
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Laboratory Corporation of America Holdings (LH) : Free Stock Analysis Report
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