Laboratory Corp. of America Holdings (NYSE:LH)

CAPS Rating: 3 out of 5

An independent clinical laboratory company that offers a range of clinical laboratory tests which are used by the medical profession in routine testing, patient diagnosis, and in the monitoring and treatment of disease.

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Player Avatar maritlee (95.72) Submitted: 6/4/2009 11:58:07 AM : Underperform Start Price: $61.14 LH Score: +38.96

I have contracted with LabCorp on a research study. Our staff drew blood from participants, we sent it to LabCorp, and they sent us results. In theory.

In reality:

they several times billed the wrong account, causing an accounting headache on our end
they sent results late, or sometimes not at all, requiring our staff to spend hours on the phone tracking them down
they didn't bill at all in some cases--causing an accounting headache on our end and still more time on the phone

In theory their business model is more efficient (we did not need our own lab technician nor lab equipment or reagents or anything, we just needed access to fedex and a fax machine)...but their management of every day affairs makes working with them a royal pain, and by the time our study staff was finished fixing all of their errors we might well have better spent the money on our own lab. I will not contract with them again.

From an investment standpoint, their failure to deliver the promised product (lab results) in a timely fashion will lead to dissatisfied customers. Their failure to bill for their product in a correct and timely fashion will hurt their balance sheet (did I mention there were several tests for which our grant was never billed? We eventually gave the money back to the funding agency.).

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