Laboratory Corp. of America (NYSE: LH) and China Cord Blood (NYSE:CO) are both healthcare companies, but which is the better stock? We will compare the two businesses based on the strength of their analyst recommendations, valuation, institutional ownership, risk, profitability, dividends and earnings.

Profitability

This table compares Laboratory Corp. of America and China Cord Blood’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Laboratory Corp. of America 7.40% 16.75% 6.43%
China Cord Blood 26.79% 9.68% 4.36%

Risk and Volatility

Laboratory Corp. of America has a beta of 0.87, suggesting that its share price is 13% less volatile than the S&P 500. Comparatively, China Cord Blood has a beta of 0.88, suggesting that its share price is 12% less volatile than the S&P 500.

Insider and Institutional Ownership

91.4% of Laboratory Corp. of America shares are held by institutional investors. Comparatively, 9.1% of China Cord Blood shares are held by institutional investors. 0.9% of Laboratory Corp. of America shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company will outperform the market over the long term.

Analyst Recommendations

This is a summary of recent ratings and recommmendations for Laboratory Corp. of America and China Cord Blood, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Laboratory Corp. of America 0 5 8 0 2.62
China Cord Blood 0 0 0 0 N/A

Laboratory Corp. of America currently has a consensus target price of $171.83, suggesting a potential upside of 0.49%. Given Laboratory Corp. of America’s higher possible upside, analysts plainly believe Laboratory Corp. of America is more favorable than China Cord Blood.

Valuation & Earnings

This table compares Laboratory Corp. of America and China Cord Blood’s revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Laboratory Corp. of America $9.64 billion 1.81 $732.10 million $7.17 23.85
China Cord Blood $110.41 million 9.92 $18.33 million $0.35 25.94

Laboratory Corp. of America has higher revenue and earnings than China Cord Blood. Laboratory Corp. of America is trading at a lower price-to-earnings ratio than China Cord Blood, indicating that it is currently the more affordable of the two stocks.

Summary

Laboratory Corp. of America beats China Cord Blood on 9 of the 13 factors compared between the two stocks.

Laboratory Corp. of America Company Profile

Laboratory Corporation of America Holdings is a life sciences company that is integrated in guiding patient care, providing clinical laboratory and end-to-end drug development services. The Company operates as a healthcare diagnostics company. The Company operates through two segments: LabCorp Diagnostics (LCD) and Covance Drug Development (CDD). The LCD segment is an independent clinical laboratory business, which offers menu of frequently requested and specialty testing through an integrated network of primary and specialty laboratories across the United States. The CDD segment offers drug development services, and provides a range of drug research and development (R&D) and market access services to biopharmaceutical companies and medical device companies across the world. It serves a range of customers, including managed care organizations (MCOs), biopharmaceutical companies, governmental agencies, physicians and other healthcare providers.

China Cord Blood Company Profile

China Cord Blood Corporation is a provider of cord blood banking services in China. The Company and its subsidiaries are principally engaged in the provision of umbilical cord blood storage and ancillary services in the People’s Republic of China. It provides cord blood testing, processing and storage services under the direction of subscribers for a cord blood processing fee and a storage fee. It also tests, processes and stores donated cord blood, and provides matching services to the public for a fee. The Company provides cord blood processing and storage services for expectant parents interested in capturing the opportunities made available by evolving medical treatments and technologies, such as cord blood transplants. It also preserves cord blood units donated by the public; provides matching services on such donated units, and delivers matching units to patients in need of transplants. As of March 31, 2016, the Company had three operating cord blood banks.

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