Laboratory Corp 'Poised For Breakout,' CMT Frank Longman Says

• Laboratory Corp. of America Holdings LH shares are up 2 percent in the last three months, and have traded north of $120 through most of November and so far in December.
• Brean Capital’s Frank Longman stated that the company’s current share price has 21.9 percent upside, before 8.9 percent downside.

Laboratory Corp’s shares have surged over 16 percent since they retested their last base breakout in September. The stock has been “in a controlled, healthy looking correction/ consolidation since March,” analyst Frank Longman said.

While indicators have not been particularly not, they have been generally constructive, Longman noted. He added that the stock is merely 4 points below its next breakout at $127 and “that achievement would project to $150 assuming that a breakout yields about the height of the recent consolidation (energy compressed = energy released).”

Longman commented, “We'd call LH a reasonable probability "150 before a close < 112" proposition from here.” He said that this would be $27 up, representing a 21.9 percent increase, before $11 down, or 8.9 percent decline.

The bottom line is that Laboratory Corp’s shares appear poised for 21.9 percent upside before 8.9 percent downside from the current price. The ratio will become more favorable on pullbacks that do not cross the $112 mark. “We'd call it a relative long and recommend "doing the work.",” Longman said.