Labcorp raises annual profit forecast on strong diagnostic testing demand
Tweet
Share
E-mail
FILE PHOTO: The logo for Labcorp, Laboratory Corporation of America, a life sciences company is displayed on a screen on the floor of the New York Stock Exchange (NYSE) in New York City, U.S., June 22, 2023. REUTERS/Brendan McDermid/File photo
(Reuters) -Labcorp raised its annual profit forecast on Thursday after beating Wall Street estimates for second-quarter profit and revenue on robust demand for its diagnostic tests, sending its shares up over 10%.
The company now expects its 2025 adjusted profit to be between $16.05 and $16.50 per share, compared with $15.70 to $16.40 forecast earlier.
Labcorp also raised revenue growth forecasts for both its diagnostic lab business and the smaller, biopharma laboratory services unit, which offers contract research facilities for biopharmaceutical companies, citing a weaker dollar and "the underlying strength of its businesses."
Steady demand for non-urgent surgeries, especially among older Americans, over the last few quarters has buoyed the business of companies such as Labcorp.
Peers including Quest Diagnostics, which raised its 2025 forecasts, have also benefited from agreements to manage hospital laboratories as they seek to expand market share.
"The increase in guidance ... is further evidence that the company is seeing enterprise strength across the portfolio, including an impressive reboot in early development," said Leerink Partners analyst Michael Cherny.
Contract research firms have witnessed reduced spending from early-stage drug developers in the past two years.
Labcorp's quarterly revenue rose 9.5% to $3.53 billion, beating analysts' average estimate of $3.49 billion, according to data compiled by LSEG.
Revenue rose 8.9% to $2.75 billion in the company's diagnostic lab unit and 11% to $784.8 million in its contract research business.
On an adjusted basis, the company posted a profit of $4.35 per share in the quarter ended June 30, compared with analysts' average estimate of $4.17.
(Reporting by Puyaan Singh in Bengaluru; Editing by Maju Samuel)
Serious News for Serious Traders! Try StreetInsider.com Premium Free!
You May Also Be Interested In
- Gentex Corporation (GNTX) Tops Q2 EPS by 8c ; Offers Guidance
- Lamb Weston (LW) Tops Q4 EPS by 25c; offers guidance
- Britain would be target if it supports US in war, Iran's Revolutionary Guards say
Create E-mail Alert Related Categories
Earnings, ReutersSign up for StreetInsider Free!
Receive full access to all new and archived articles, unlimited portfolio tracking, e-mail alerts, custom newswires and RSS feeds - and more!
