Critical Comparison: Labcorp (NYSE:LH) vs. Cencora (NYSE:COR)

Cencora (NYSE:COR) and Labcorp (NYSE:LH) are both large-cap healthcare companies, but which is the superior investment? We will compare the two companies based on the strength of their risk, analyst recommendations, valuation, profitability, dividends, institutional ownership and earnings.

Insider & Institutional Ownership

97.5% of Cencora shares are owned by institutional investors. Comparatively, 95.9% of Labcorp shares are owned by institutional investors. 0.4% of Cencora shares are owned by insiders. Comparatively, 0.8% of Labcorp shares are owned by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock is poised for long-term growth.

Valuation & Earnings

This table compares Cencora and Labcorp”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Cencora	$321.33 billion	0.19	$1.55 billion	$13.46	23.04
Labcorp	$13.95 billion	1.88	$876.50 million	$12.09	26.69

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

Analyst Recommendations

This is a breakdown of recent recommendations for Cencora and Labcorp, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Cencora	0	2	13	0	2.87
Labcorp	0	3	9	0	2.75

Cencora currently has a consensus price target of $374.25, indicating a potential upside of 20.68%. Labcorp has a consensus price target of $330.00, indicating a potential upside of 2.25%. Given Cencora’s stronger consensus rating and higher probable upside, equities analysts plainly believe Cencora is more favorable than Labcorp.

Volatility and Risk

Cencora has a beta of 0.57, suggesting that its share price is 43% less volatile than the S&P 500. Comparatively, Labcorp has a beta of 0.87, suggesting that its share price is 13% less volatile than the S&P 500.

Dividends

Cencora pays an annual dividend of $2.40 per share and has a dividend yield of 0.8%. Labcorp pays an annual dividend of $2.88 per share and has a dividend yield of 0.9%. Cencora pays out 17.8% of its earnings in the form of a dividend. Labcorp pays out 23.8% 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. Cencora has increased its dividend for 15 consecutive years.

Profitability

This table compares Cencora and Labcorp’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Cencora	0.79%	125.45%	4.18%
Labcorp	6.99%	16.74%	7.81%

Summary

Cencora beats Labcorp on 10 of the 17 factors compared between the two stocks.

About Cencora

Cencora, Inc. sources and distributes pharmaceutical products. The company's U.S. Healthcare Solutions segment distributes pharmaceuticals, over-the-counter healthcare products, home healthcare supplies and equipment, and related services to acute care hospitals and health systems, independent and chain retail pharmacies, mail order pharmacies, medical clinics, long-term care and alternate site pharmacies, and other customers; provides pharmacy management, staffing, and other consulting services; supply management software to retail and institutional healthcare providers; packaging solutions to various institutional and retail healthcare providers; clinical trial support, product post-approval, and commercialization support services; data analytics, outcomes research, and additional services for biotechnology and pharmaceutical manufacturers; pharmaceuticals, vaccines, parasiticides, diagnostics, micro feed ingredients, and other products to the companion animal and production animal markets; and sales force services to manufacturers. This segment also distributes plasma and other blood products, injectable pharmaceuticals, vaccines, and other specialty products; and provides other services to physicians who specialize in various disease states, such as oncology, as well as to other healthcare providers, including hospitals and dialysis clinics. Its International Healthcare Solutions segment offers international pharmaceutical wholesale and related service, and global commercialization services; distributes pharmaceuticals, other healthcare products, and related services to pharmacies, doctors, health centers, and hospitals primarily in Europe; and provides specialty transportation and logistics services for the biopharmaceutical industry. The company was formerly known as AmerisourceBergen Corporation and changed its name to Cencora, Inc. in August 2023. Cencora, Inc. was incorporated in 2001 and is headquartered in Conshohocken, Pennsylvania.

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.