Cencora Earnings: Ends 2023 With Solid Results and Expects Another Successful Year

Narrow-moat Cencora, formerly known as AmerisourceBergen, reported solid fourth-quarter results that were above our expectations, wrapping up fiscal 2023 on good footing. Total quarterly sales were up 12.7% year over year as demand for specialty products and GLP-1 medications (for diabetes and weight loss) continue to boost sales. Management also provided healthy guidance for fiscal 2024; it expects U.S. healthcare revenue to be up 7%-10% for the full year, international healthcare to be up 4%-8%, and adjusted diluted EPS to grow roughly 6%-8% despite lowered contributions from COVID-19-related items. After baking in these numbers and rolling our cash flow model, we are raising our fair value estimate to $176 per share from $162.