Investor Concerns Impacted Labcorp (LH) in Q4

Diamond Hill Capital, an investment management company, released its “Large Cap Fund” fourth-quarter 2025 investor letter. A copy of the letter can be downloaded here. Equity markets continued their upward momentum in Q4, with the Russell 1000 Value Index increasing 3.8%. The information technology (+11%) and communication services (+9%) sectors are leading the rally, driven by AI optimism. The growth areas of the market accounted for the majority of the Index’s return in Q4. The firm maintains a cautious stance toward AI-driven market enthusiasm and believes that, fundamentally stable, high-quality, cash-generative businesses present attractive opportunities. Against this backdrop, the Fund returned 1.41% in the quarter, lagging the Russell 1000 Value Index’s 3.8% return. In addition, you can check the Fund’s top five holdings to see its best picks for 2025.

In its fourth-quarter 2025 investor letter, Diamond Hill Large Cap Fund highlighted Labcorp Holdings Inc. (NYSE:LH) as one of the leading performance detractors. Labcorp Holdings Inc. (NYSE:LH) is a laboratory services company that operates through the Diagnostics Laboratories and Biopharma Laboratory Services segments. The one-month return of Labcorp Holdings Inc. (NYSE:LH) was 3.80%, and its shares gained 9.58% of their value over the last 52 weeks. On February 2, 2026, Labcorp Holdings Inc. (NYSE:LH) stock closed at $270.29 per share with a market capitalization of $22.461 billion.

Diamond Hill Large Cap Fund stated the following regarding Labcorp Holdings Inc. (NYSE:LH) in its fourth quarter 2025 investor letter:

“Shares of leading diagnostic lab Labcorp Holdings Inc. (NYSE:LH) declined amid investor concern surrounding lower-than-expected guidance, driven by delays in acquisition closings and weakness in its development pipeline, leading to a restructuring of that business. However, we maintain our conviction in the company’s competitive advantages in the diagnostic space, as the company’s scale allows it to be a low-cost provider with better-than-average margins.”

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Labcorp Holdings Inc. (NYSE:LH) is not on our list of 30 Most Popular Stocks Among Hedge Funds. According to our database, 47 hedge fund portfolios held Labcorp Holdings Inc. (NYSE:LH) at the end of the third quarter, up from 42 in the previous quarter. While we acknowledge the risk and potential of Labcorp Holdings Inc. (NYSE:LH) as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and doing so within a shorter time frame. If you are looking for an AI stock that is more promising than Labcorp Holdings Inc. (NYSE:LH) and that has 10,000% upside potential, check out our report about this cheapest AI stock.

In addition, please check out our hedge fund investor letters Q4 2025 page for more investor letters from hedge funds and other leading investors.

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Disclosure: None. This article is originally published at Insider Monkey.