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Cencora Inc COR

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Stock XNYS Rating as of
$223.95 −0.79 (0.35%)
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Company Report

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Cencora Earnings: Healthy Margins Make Up for Slightly Tempered Sales; Fair Value Estimate Raised

Keonhee Kim

Narrow-moat Cencora reported second-quarter earnings that came in slightly better than we expected. Total sales of $68.4 billion were up 7.8% year over year as both US and international solutions enjoyed solid utilization trends and delivered solid growth. Management raised the bottom of the adjusted diluted EPS guidance range to $13.30 from $13.25 on the backdrop of strong margin growth. After ticking up our margin assumptions for the near term and accounting for time value of money impact, we raise our fair value estimate to $194 per share from $183.

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Price vs Fair Value

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COR is trading at a 15% premium.
Price
$223.95
Fair Value
$741.00
Uncertainty
Medium
1-Star Price
$326.20
5-Star Price
$473.30
Economic Moat
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Capital Allocation
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Bulls Say, Bears Say

Bulls

Cencora 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 have led to an emphasis on cost containment, pressuring Cencora's profitability.

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News

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Trading Information

Previous Close Price
$224.74
Day Range
$222.20–224.86
52-Week Range
$163.37–246.75
Bid/Ask
$220.00 / $254.81
Market Cap
$44.67 Bil
Volume/Avg
2.2 Mil / 1.3 Mil

Key Statistics

Price/Earnings (Normalized)
17.41
Price/Sales
0.16
Dividend Yield (Trailing)
0.89%
Dividend Yield (Forward)
0.91%
Total Yield
2.70%

Company Profile

Cencora is one of three domestic leading pharmaceutical wholesalers. It sources and distributes branded, generic, and specialty pharmaceutical products to pharmacies (retail chains, independent, and mail order), hospital networks, and healthcare providers. It and McKesson and Cardinal Health constitute over 90% of the US pharmaceutical wholesale industry. Cencora also provides commercialization services for manufacturers of pharmaceuticals and medical devices, global specialty drug logistics (World Courier), and animal health product distribution (MWI Animal Health). Cencora expanded its international presence in 2021 by purchasing Alliance Healthcare, one of the leading drug wholesalers in Europe.
Sector
Healthcare
Industry
Medical Distribution
Stock Style Box
Mid Core
Total Number of Employees
46,000
Website
https://www.cencora.com

Competitors

Valuation

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Metric
COR
CAH
MCK
Price/Earnings (Normalized)
 17.4113.7818.60
Price/Book Value
 41.23——
Price/Sales
 0.160.110.24
Price/Cash Flow
 13.9110.2215.23
Price/Earnings
COR
CAH
MCK

Financial Strength

Metric
COR
CAH
MCK
Quick Ratio
 0.500.430.48
Current Ratio
 0.890.980.92
Interest Coverage
 9.1018.3714.72
Quick Ratio
COR
CAH
MCK

Profitability

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

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Name
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Economic Moat
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MCK
McKesson CorpRkmglhmhyMdtzd$69.5 Bil
CAH
Cardinal Health IncWmtjrtdqPsvwjwv$24.1 Bil
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