Labcorp (NYSE:LH – Get Free Report) and Organon & Co. (NYSE:OGN – Get Free Report) are both medical companies, but which is the superior stock? We will contrast the two companies based on the strength of their valuation, profitability, risk, earnings, institutional ownership, analyst recommendations and dividends.
Valuation & Earnings
This table compares Labcorp and Organon & Co.”s top-line revenue, earnings per share (EPS) and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| Labcorp | $13.95 billion | 1.62 | $876.50 million | $10.46 | 26.17 |
| Organon & Co. | $6.22 billion | 0.27 | $187.00 million | $0.71 | 9.20 |
Dividends
Labcorp pays an annual dividend of $2.88 per share and has a dividend yield of 1.1%. Organon & Co. pays an annual dividend of $0.08 per share and has a dividend yield of 1.2%. Labcorp pays out 27.5% of its earnings in the form of a dividend. Organon & Co. pays out 11.3% of its earnings in the form of a dividend. Both companies have healthy payout ratios and should be able to cover their dividend payments with earnings for the next several years. Organon & Co. is clearly the better dividend stock, given its higher yield and lower payout ratio.
Profitability
This table compares Labcorp and Organon & Co.’s net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| Labcorp | 6.28% | 16.16% | 7.62% |
| Organon & Co. | 3.01% | 122.01% | 6.74% |
Volatility and Risk
Labcorp has a beta of 1.01, meaning that its stock price is 1% more volatile than the S&P 500. Comparatively, Organon & Co. has a beta of 0.61, meaning that its stock price is 39% less volatile than the S&P 500.
Insider and Institutional Ownership
95.9% of Labcorp shares are owned by institutional investors. Comparatively, 77.4% of Organon & Co. shares are owned by institutional investors. 0.8% of Labcorp shares are owned by company insiders. Comparatively, 1.4% of Organon & Co. shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock is poised for long-term growth.
Analyst Recommendations
This is a summary of recent ratings and target prices for Labcorp and Organon & Co., as provided by MarketBeat.com.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Labcorp | 0 | 3 | 9 | 0 | 2.75 |
| Organon & Co. | 5 | 1 | 0 | 1 | 1.57 |
Labcorp presently has a consensus price target of $304.82, indicating a potential upside of 11.34%. Organon & Co. has a consensus price target of $8.50, indicating a potential upside of 30.07%. Given Organon & Co.’s higher possible upside, analysts clearly believe Organon & Co. is more favorable than Labcorp.
Summary
Labcorp beats Organon & Co. on 11 of the 17 factors compared between the two stocks.
About Labcorp
Labcorp Holdings, Inc. engages in providing medical testing services. The company was founded on April 16, 2024 and is headquartered in Burlington, NC.
About Organon & Co.
Organon & Co. is a science based global pharmaceutical company, which develops and delivers innovative health solutions through a portfolio of prescription therapies within women’s health, biosimilars and established brands. The company was founded on March 11, 2020, and is headquartered in Jersey City, NJ.
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