Laboratory Corp. of America Earnings: Profit Increases Again

S&P 500 (NYSE:SPY) component Laboratory Corporation of America Holdings (NYSE:LH) reported its results for the second quarter. Laboratory Corporation of America provides testing services used by the medical profession in patient diagnosis and in the monitoring and treatment of disease.

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Laboratory Corporation of America Holdings Earnings Cheat Sheet

Results: Net income for Laboratory Corporation of America Holdings rose to $153.3 million ($1.56 per share) vs. $122.9 million ($1.20 per share) in the same quarter a year earlier. This marks a rise of 24.7% from the year-earlier quarter.

Revenue: Rose 1.4% to $1.42 billion from the year-earlier quarter.

Actual vs. Wall St. Expectations: Laboratory Corporation of America Holdings reported adjusted net income of $1.77 per share. By that measure, the company was about in line with expectations as the mean analyst estimate was $1.78 per share. Analysts were expecting revenue of $1.44 billion.

Quoting Management: “We delivered a solid quarter given that we continue to face a low-volume-growth environment,” said David P. King, Chairman and Chief Executive Officer. “We continued to build for the future as we received clearance to proceed with our acquisition of MEDTOX Scientific, Inc., which will broaden our expertise in esoteric toxicology testing. At the same time we achieved earnings growth through disciplined expense management, particularly in selling, general and administrative expenses.”

Key Stats:

The company has now seen its net income increase for three consecutive quarters. In the first quarter, net income rose 27.1% and in the fourth quarter of the last fiscal year, the figure rose 2.7%.

Revenue has risen for the last four quarters. Revenue increased 4% to $1.42 billion in the first quarter. The figure rose 5.5% in the fourth quarter of the last fiscal year from the year earlier and climbed 10% in the third quarter of the last fiscal year from the year-ago quarter.

The company fell short of forecasts after beating estimates in the previous two quarters. In the first quarter, it topped the mark by 6 cents, and in the fourth quarter of the last fiscal year, it was ahead by 4 cents.

Looking Forward: Over the past sixty days, the outlook for the company’s performance next quarter has become increasingly unfavorable. The average estimate for the third quarter is $1.78 per share, a drop from $1.79. In the past month, the average estimate for the fiscal year has fallen from $7.04 per share to $7.

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(Company fundamentals provided by Xignite Financials. Earnings estimates provided by Zacks)

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