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Cardinal Health Inc CAH

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Stock XNYS Rating as of
$98.91 −4.07 (3.95%)
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As of Delayed Price Closed
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Company Report

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Cardinal Health Earnings: Sales Growth Starts to Slow but Margin Comes Through

Keonhee Kim

Narrow-moat Cardinal Health reported third-quarter earnings that came in largely as we expected. Total sales of $54.9 billion was up 8.8% year over year thanks to stable utilization prescription trend and strong execution. All three segments posting a sequential margin improvement was also a nice surprise. After adjusting our 2024 and 2025 assumptions and baking in time value of money, we raise our fair value estimate to $92 per share from $88.

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Price vs Fair Value

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CAH is trading at a 8% premium.
Price
$98.91
Fair Value
$84.00
Uncertainty
Medium
1-Star Price
$462.90
5-Star Price
$65.70
Economic Moat
Rymmc
Capital Allocation
Pjhnqqd

Bulls Say, Bears Say

Bulls

Cardinal Health distributes pharmaceutical products to nearly one third of the industry, leading to substantial negotiation leverage with generic drug manufacturers.

Bears

Reimbursement pressures on pharmacy and provider customers has led to an emphasis on cost containment, pressuring Cardinal Health’s profitability.

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News

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Trading Information

Previous Close Price
$102.98
Day Range
$98.24–102.26
52-Week Range
$77.56–116.04
Bid/Ask
$95.00 / $105.00
Market Cap
$24.09 Bil
Volume/Avg
3.4 Mil / 2.3 Mil

Key Statistics

Price/Earnings (Normalized)
13.78
Price/Sales
0.11
Dividend Yield (Trailing)
2.02%
Dividend Yield (Forward)
2.02%
Total Yield
7.21%

Company Profile

Cardinal Health is one of three leading pharmaceutical wholesalers in the US, engaged in sourcing and distributing of branded, generic, and specialty pharmaceutical products to pharmacies (retail chains, independent, and mail order), hospitals networks, and healthcare providers. Along with Cencora and McKesson, the three comprise well over 90% of the US pharmaceutical wholesale industry. Cardinal Health also supplies medical-surgical products and equipment to healthcare facilities in North America, Europe, and Asia.
Sector
Healthcare
Industry
Medical Distribution
Stock Style Box
Mid Core
Total Number of Employees
48,000
Website
https://www.cardinalhealth.com

Competitors

Valuation

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Metric
CAH
COR
MCK
Price/Earnings (Normalized)
 13.7817.4118.60
Price/Book Value
 —41.23—
Price/Sales
 0.110.160.24
Price/Cash Flow
 10.2213.9115.23
Price/Earnings
CAH
COR
MCK

Financial Strength

Metric
CAH
COR
MCK
Quick Ratio
 0.430.500.48
Current Ratio
 0.980.890.92
Interest Coverage
 18.379.1014.72
Quick Ratio
CAH
COR
MCK

Profitability

Metric
CAH
COR
MCK
Return on Assets (Normalized)
 4.01%4.19%6.00%
Return on Equity (Normalized)
 —373.63%—
Return on Invested Capital (Normalized)
 97.71%47.73%66.76%
Return on Assets
CAH
COR
MCK
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Medical Distribution Industry Comparables

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Name
Morningstar Rating for Stocks
Capital Allocation
Economic Moat
Market Cap
MCK
McKesson CorpGjwzstwgZsmtw$69.5 Bil
COR
Cencora IncYphrhbmskRklwj$44.7 Bil
SHPMF
Shanghai Pharmaceuticals Holding Co Ltd Class H—Dkjnbt$8.2 Bil
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Sinopharm Group Co Ltd—Frpypvc$7.8 Bil
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Amplifon SpA Az nom Post Frazionamento—Fwvqmr$7.6 Bil
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Medipal Holdings Corp ADR—Yfvc$3.4 Bil
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