Is LH a high-quality business?

AlphaMadera's AlphaQuality grade scores Labcorp Holdings Inc. on six pillars — profitability, capital efficiency, balance-sheet strength, growth durability, cash generation, and shareholder yield. The composite letter grade reflects how LH compares to a Buffett-style quality bar.

What is Labcorp Holdings Inc.'s AlphaQuality grade?

AlphaQuality assigns a letter grade (A through F) to LH based on a six-pillar quantitative model. The live page shows the composite grade plus each pillar's individual score with the underlying metrics.

What makes LH a quality stock?

AlphaQuality looks at return on capital, free-cash-flow margins, debt-to-equity, revenue stability, dividend and buyback policy, and operating-margin trend. Stocks scoring well across all six pillars earn higher grades — the methodology favors compounders over cyclicals.

LH - Labcorp Holdings Inc.

Price: -- -- | CONSENSUS: Buy DETAILS | PRICE TARGET: $311.33 DETAILS

AlphaQuality

Quantitative six-pillar business-quality grade

Stable Earnings Power

AlphaQuality — archetype-weighted quantitative grade

C 54.6 / 100 composite

Composite Grade

Composite of six pillars weighted for stable earnings power businesses. Purely quantitative — no stock price or analyst input.

Profitability

Weight: 20%

D 34.3

5yr Avg ROIC 7.8% 49/100
Operating Margin Trend -2.84 pp/yr 0/100

Capital Efficiency

Weight: 15%

A- 82.0

5yr Avg ROE 13.2% 74/100
5yr Share-Count CAGR -3.7% 97/100

Growth Quality

Weight: 15%

F 26.7

5yr Revenue CAGR 1.5% 33/100
5yr EPS CAGR -19.1% 0/100
Revenue-Growth Years (5) 3/5 60/100

Cash Generation

Weight: 15%

A- 81.7

5yr FCF Margin 11.4% 73/100
5yr FCF/NI Conversion 1.44x 92/100

Balance Sheet

Weight: 20%

C+ 59.8

Net Debt / EBITDA 3.31x 44/100
Interest Coverage (EBIT/Int) 5.94x 69/100
Altman Z-Score 2.96 78/100

Stability

Weight: 15%

C- 47.4

EPS Volatility (σ/μ) 0.53 28/100
Piotroski F-Score 6 67/100
Negative-Revenue Years (5) 2/5 60/100

3 of 3 gurus held; 1 added; 1 trimmed.

Holders: 3
Avg Δ position: -7.6%
New buys: 0
Full exits: 0

Dalio decreased -36%
Greenblatt increased +13%

How this is calculated

AlphaQuality grades six pillars from 0-100 and weights each by archetype:

Profitability (20%) — 5yr Avg ROIC, Operating Margin Trend
Capital Efficiency (15%) — 5yr Avg ROE, 5yr Share-Count CAGR
Growth Quality (15%) — 5yr Revenue CAGR, 5yr EPS CAGR, Revenue-Growth Years (5)
Cash Generation (15%) — 5yr FCF Margin, 5yr FCF/NI Conversion
Balance Sheet (20%) — Net Debt / EBITDA, Interest Coverage (EBIT/Int), Altman Z-Score
Stability (15%) — EPS Volatility (σ/μ), Piotroski F-Score, Negative-Revenue Years (5)

We deliberately ignore stock price, analyst targets, and consensus ratings so the grade is suitable for backtesting forward returns. A minimum of 5 fiscal years of audited statements is required; distressed and highly leveraged infrastructure businesses are declared ungradable rather than forced into a numeric score.