Laboratory Corp. of America (LH) & InVitae (NVTA) Critical Comparison

Laboratory Corp. of America (NYSE: LH) and InVitae (NYSE:NVTA) are both medical companies, but which is the better investment? We will contrast the two companies based on the strength of their earnings, institutional ownership, profitability, analyst recommendations, risk, dividends and valuation.

Analyst Recommendations

This is a summary of current ratings for Laboratory Corp. of America and InVitae, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Laboratory Corp. of America 0 3 13 0 2.81
InVitae 0 0 4 0 3.00

Laboratory Corp. of America presently has a consensus target price of $192.31, suggesting a potential upside of 1.68%. InVitae has a consensus target price of $11.00, suggesting a potential upside of 36.14%. Given InVitae’s stronger consensus rating and higher probable upside, analysts plainly believe InVitae is more favorable than Laboratory Corp. of America.

Insider and Institutional Ownership

92.2% of Laboratory Corp. of America shares are held by institutional investors. Comparatively, 69.9% of InVitae shares are held by institutional investors. 0.7% of Laboratory Corp. of America shares are held by insiders. Comparatively, 8.7% of InVitae shares are held by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company is poised for long-term growth.

Volatility & Risk

Laboratory Corp. of America has a beta of 0.93, indicating that its stock price is 7% less volatile than the S&P 500. Comparatively, InVitae has a beta of 1.2, indicating that its stock price is 20% more volatile than the S&P 500.

Profitability

This table compares Laboratory Corp. of America and InVitae’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Laboratory Corp. of America 11.52% 16.33% 6.49%
InVitae -154.96% -127.38% -68.70%

Valuation and Earnings

This table compares Laboratory Corp. of America and InVitae’s revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Laboratory Corp. of America $10.44 billion 1.85 $1.27 billion $9.60 19.70
InVitae $68.22 million 7.96 -$123.38 million ($2.65) -3.05

Laboratory Corp. of America has higher revenue and earnings than InVitae. InVitae is trading at a lower price-to-earnings ratio than Laboratory Corp. of America, indicating that it is currently the more affordable of the two stocks.

Summary

Laboratory Corp. of America beats InVitae on 9 of the 14 factors compared between the two stocks.

Laboratory Corp. of America Company Profile

Laboratory Corporation of America Holdings operates as an independent clinical laboratory company worldwide. It operates through two segments, LabCorp Diagnostics and Covance Drug Development. It offers a range of clinical laboratory tests, such as blood chemistry analyses, urinalyses, blood cell counts, thyroid tests, Pap tests, hemoglobin A1C, prostate-specific antigen, tests for sexually-transmitted diseases, hepatitis C tests, vitamin D, microbiology cultures and procedures, and alcohol and other substance-abuse tests that are used by hospitals, physicians and other healthcare providers and commercial clients to assist in the diagnosis, monitoring and treatment of diseases and medical conditions through the examination of substances in blood, tissues, and other specimens. The company also provides specialty testing services in the areas of women's health, allergy, diagnostic genetics, cardiovascular disease, infectious disease, endocrinology, oncology, coagulation, pharmacogenetics, toxicology, medical drug monitoring, and pain management; and esoteric testing, cancer diagnostics, and other complex procedures. In addition, it provides drug development solutions and laboratory testing services; and testing services through a sales force to the managed care organizations, biopharmaceutical companies, governmental agencies, physicians and other healthcare providers, hospitals and health systems, employers, patients and consumers, contract research organizations, food and nutritional companies, and independent clinical laboratories. The company has collaboration with university, hospital and academic institutions, such as Boston University, Columbia University, Duke University, Johns Hopkins University, The Mount Sinai Hospital, the University of Tennessee, and Yale University to license and commercialize new diagnostic tests. Laboratory Corporation of America Holdings was founded in 1971 and is headquartered in Burlington, North Carolina.

InVitae Company Profile

Invitae Corporation, a genetic information company, processes DNA-containing samples, analyzes information related to patient-specific genetic variation, and generates test reports for clinicians and their patients in the United States, Canada, and internationally. The company's tests include multiple genes associated with hereditary cancer, neurological disorders, cardiovascular disorders, pediatric disorders, metabolic disorders, and other hereditary conditions; proactive health and wellness screening; and preimplantation embryo testing and carrier screening for inherited disorders, prenatal diagnosis, miscarriage analysis, and pediatric developmental disorders. It also operates Patient Insights Networks, a platform for collecting, curating, coordinating, and delivering data from patients and clinicians; and CancerGene Connect, an end-to-end platform that is used for the collection, analysis, and management of patient family history information. Invitae Corporation serves patients, healthcare providers, and biopharma and advocacy partners. The company was formerly known as Locus Development, Inc. and changed its name to Invitae Corporation in 2012. Invitae Corporation was founded in 2010 and is headquartered in San Francisco, California.

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