Laboratory Corporation of America Holdings (NYSE: LH) and Streamline Health Solutions (NASDAQ:STRM) are both medical companies, but which is the better investment? We will contrast the two companies based on the strength of their risk, analyst recommendations, dividends, valuation, profitability, earnings and institutional ownership.

Earnings and Valuation

This table compares Laboratory Corporation of America Holdings and Streamline Health Solutions’ gross revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Laboratory Corporation of America Holdings $9.67 billion 1.62 $1.86 billion $7.12 21.57
Streamline Health Solutions $26.32 million 1.11 -$3.17 million ($0.31) -4.81

Laboratory Corporation of America Holdings has higher revenue and earnings than Streamline Health Solutions. Streamline Health Solutions is trading at a lower price-to-earnings ratio than Laboratory Corporation of America Holdings, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares Laboratory Corporation of America Holdings and Streamline Health Solutions’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Laboratory Corporation of America Holdings 7.57% 16.85% 6.55%
Streamline Health Solutions -24.50% -53.33% -15.25%

Volatility and Risk

Laboratory Corporation of America Holdings has a beta of 0.94, meaning that its stock price is 6% less volatile than the S&P 500. Comparatively, Streamline Health Solutions has a beta of 0.16, meaning that its stock price is 84% less volatile than the S&P 500.

Analyst Recommendations

This is a summary of recent ratings for Laboratory Corporation of America Holdings and Streamline Health Solutions, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Laboratory Corporation of America Holdings 0 4 6 0 2.60
Streamline Health Solutions 0 0 0 0 N/A

Laboratory Corporation of America Holdings presently has a consensus price target of $165.10, indicating a potential upside of 7.49%. Given Laboratory Corporation of America Holdings’ higher possible upside, research analysts plainly believe Laboratory Corporation of America Holdings is more favorable than Streamline Health Solutions.

Institutional & Insider Ownership

93.2% of Laboratory Corporation of America Holdings shares are held by institutional investors. Comparatively, 38.5% of Streamline Health Solutions shares are held by institutional investors. 0.9% of Laboratory Corporation of America Holdings shares are held by insiders. Comparatively, 26.1% of Streamline Health Solutions shares are held by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company is poised for long-term growth.

Summary

Laboratory Corporation of America Holdings beats Streamline Health Solutions on 11 of the 12 factors compared between the two stocks.

About Laboratory Corporation of America Holdings

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.

About Streamline Health Solutions

Streamline Health Solutions, Inc. is engaged in providing healthcare information technology through the licensing of its Electronic Health Information Management, Patient Financial, Coding and Clinical Documentation Improvement (CDI), and other Workflow software applications, and the use of such applications by software as a service. The Company also provides implementation and consulting services to complement its software solutions. The Company provides computer software-based solutions through its Looking Glass platform. The Company sells its solutions and services in North America to hospitals and health systems, including physician practices, through its direct sales force and its reseller partnerships. The Company’s software and services allow hospitals and integrated healthcare delivery systems in the United States and Canada to capture, store, manage, route, retrieve and process patient clinical, financial and other healthcare provider information.

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