Laboratory Corporation of America Holdings (HL – Free Report), popularly known as LabCorp, recently announced plans to initiate testing for monkeypox. This test will be performed using the US Centers for Disease Control and Prevention (CDC) orthopoxvirus test, which detects all non-pox-related orthopoxviruses, including monkeypox.
This LabCorp initiative aims to help control the monkeypox outbreak. According to LabCorp, this effort is part of the CDC’s commitment to rapidly increase access and capacity for monkeypox testing in every community during the ongoing outbreak.
With this, Labcorp will be the first national lab to offer this CDC-verified polymerase chain reaction (PCR) test. Additionally, LabCorp is the first to launch a more automated analysis option.
As monkeypox spreads rapidly in the United States, LabCorp’s latest initiative to perform its tests is expected to gain rapid market adoption, helping the company’s LabCorp Diagnostics business.
More on the news
This test for monkeypox will be offered by LabCorp’s largest laboratory in the United States. It also has the ability to accept samples from LabCorp customers as well as overflows from public labs across the United States with its extensive transportation and logistics capabilities. Eventually, Labcorp plans to increase capacity to up to 10,000 tests per week, doubling the current capacity provided by the CDC’s Laboratory Response Network (LRN).
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According to LabCorp, the increased testing capacity will leverage its established relationships with the clinics, hospitals and healthcare providers it serves. LabCorp will use Electronic Laboratory Reports (ELRs) to report results to jurisdictions, as outlined in CDC reporting guidelines.
LabCorp targets high growth areas
In its efforts to identify and expand into high-growth areas, LabCorp recently unveiled a new risk-scoring test for patients with advanced liver fibrosis due to NASH. The Enhanced Liver Fibrosis (ELF) test, developed by Siemens Healthineers, assesses the risk of progression of advanced liver fibrosis in individuals and facilitates early intervention to promote better patient outcomes. In March 2022, LabCorp became the first US commercial laboratory to offer Immundiagnostik, Inc.’s new test that helps individuals identify and quantify unintentional gluten consumption. This test should help doctors assess for true “refractory” celiac disease by ruling out gluten exposure as the cause of prolonged symptoms.
In late 2021, LabCorp acquired an autoimmune business unit from Myriad Genetics, including Vectra, a test for rheumatoid arthritis. This should strengthen the company’s position in rheumatoid arthritis, which the CDC estimates will affect approximately 25% of adults in the United States by 2040. Additionally, in women’s health, another area of interest, LabCorp acquired Ovia Health in August 2021, a digital health platform for finding family planning, pregnancy and parenting information and support. The transaction strengthens Labcorp’s position as a go-to source for women’s health information.
In oncology, another high-growth area, LabCorp signed a definitive agreement to acquire Personal Genome Diagnostics Inc. (PGDx) in December 2021. This acquisition will expand LabCorp’s oncology portfolio of genomic profiling capabilities based on the sequencing of Generation (NGS), placing the company at the forefront of improving patient outcomes in oncology. During its first quarter 2022 earnings call, LabCorp reported that it had completed the acquisition of PGDx and the integration process was progressing well. Other notable offerings on the company’s oncology testing menu include OmniSeq INSIGHT, a pancancer tissue sequencing test for people with advanced-stage solid tumors, and clonoSEQ, the first and only FDA-cleared test. for monitoring residual blood cancer.
In 2021, LabCorp opened an integrated laboratory in Singapore, which strengthened the company’s bioanalytical services in the Asia-Pacific region. In February 2022, the company opened a new diagnostic laboratory in South Bend, IN.
Share price performance
Over the past six months, LabCorp has underperformed its industry. LabCorp shares fell 16.4% compared to the sector’s 11.9% plunge.
Zacks Ranking and Key Picks
Currently, LabCorp carries a Zacks Rank #3 (Hold).
Some top-ranked actions in the broader medical field are AMN Healthcare Services, Inc. (AMN – free report), Patterson Companies, Inc. (OFSP – free report) and ShockWave Medical, Inc. (SWAV – free report).
AMN Healthcare, which currently holds the No. 2 Zacks ranking (buy), has an estimated long-term growth rate of 1.1%. AMN’s earnings have exceeded the Zacks consensus estimate for the past four quarters, averaging 15.6%.
You can see the full list of today’s Zacks #1 Rank (Strong Buy) stocks here.
AMN Healthcare gained 18.2% against the industry’s 47.8% drop over the past year.
The Patterson Companies, which currently carry the Zacks No. 2 ranking, have an estimated long-term growth rate of 9.6%. PDCO’s earnings have exceeded estimates over the past four quarters, averaging 16.5%.
Patterson Companies gained 0.7% against the industry’s 10.1% drop over the past year.
ShockWave Medical, currently No. 1 Zacks, has an estimated growth rate of 44.9% for 2023. SWAV’s earnings have exceeded estimates for the past four quarters, averaging 189.9%.
ShockWave Medical gained 5.9% against the industry’s 24.9% drop over the past year.