Lab Corp.: Quality at a Discount

Diagnostic lab tests appear to be a non-deferrable expense. When your doctor needs test results to make a good treatment plan, you'd think most people wouldn't skimp. Surprisingly, the two major players, Quest Diagnostics (DGX) and Lab Corp. of America (LH), each found that patients have been holding back somewhat due to increased co-pays.

Flattish top line numbers have not seriously dented Lab Corp.'s earnings growth. Fourth-quarter results are due Feb. 8. LH's fairly predictable earnings per share numbers are expected to come in at an all-time high of $6.90. That would represent an 8.3% rise from 2011 and a 65% cumulative increase over the past five years. Despite the solid results, LH now trades for near its lowest valuation since the overall market touched its March 2009 low....184 more words left in this article. To read them, just click below and try Real Money FREE for 14 days.

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