Moody's upgrades LabCorp

Moody's Investors Service said it upgraded the senior unsecured debt rating for Laboratory Corp. of America Holdings to Baa2 from Baa3.

The outlook remains positive.

The upgrade reflects LabCorp's modest financial leverage, strong interest expense coverage and robust cash flow generation, the agency said, adding that the company has continued to see operating and credit metric improvement due to strong growth in the genomic and esoteric business and cost savings initiatives.

However, the rating reflects Moody's expectations that the company will continue to use excess cash to fund acquisitions and share repurchases.

The agency said the positive outlook reflects its continued expectation that operating income and cash flow will remain strong, driven by increases in top-line growth.

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