Skip to Content

Cardinal Health Inc CAH

Rating as of

Morningstar’s Analysis

Valuation
Currency in USD
Is it the right time to buy or sell?
Find out with Morningstar Premium
Is it the right time to buy or sell?
Find out with Morningstar Premium

1-Star Price

PREMIUM

5-Star Price

PREMIUM

Economic Moat

PREMIUM

Capital Allocation

PREMIUM

Third-Quarter Delay in Volume Recovery Is Temporary; Maintaining Cardinal Health's FVE

Karen Andersen, CFA Sector Strategist

Analyst Note

| Karen Andersen, CFA |

Narrow-moat Cardinal Health posted moderate fiscal third-quarter earnings in which a higher brand mix cushioned the impact of weak generic distribution revenue. Normalized earnings came in slightly above our expectations on both sequential and yearly bases. Compared with the fiscal second quarter, net income declined by 11%, and net margin declined by 7 basis points to 1.15%. Management expects a full recovery of branded pharmaceuticals by the end of the fiscal year based on encouraging trends in the last few months, though generics volume will remain diminished beyond this. Fiscal EPS guidance was narrowed to $5.90-$6.05 from $5.85-$6.10. We maintain our fair value estimate of $60 per share.

Read Full Analysis

Company Profile

Business Description

Cardinal Health is the third- largest global logistics provider engaged in wholesale pharmaceutical and medical products. Similar to its closest two peers, the company has evolved over time and has become entrenched in the sourcing and distribution of brand-name and generic pharmaceuticals and related services to hospitals, healthcare systems, pharmacies, ambulatory surgery centers, clinical laboratories, and physician offices. Through acquisitions, Cardinal Health has the ability to manufacture commodity products and certain medical devices.

Contact
7000 Cardinal Place
Dublin, OH, 43017
T +1 614 757-5000
Sector Healthcare
Industry Medical Distribution
Most Recent Earnings Mar 31, 2021
Fiscal Year End Jun 30, 2021
Stock Type Classic Growth
Employees 48,000

Related

Transparency is how we protect the integrity of our work and keep empowering investors to achieve their goals and dreams. And we have unwavering standards for how we keep that integrity intact, from our research and data to our policies on content and your personal data.

We’d like to share more about how we work and what drives our day-to-day business.

We sell different types of products and services to both investment professionals and individual investors. These products and services are usually sold through license agreements or subscriptions. Our investment management business generates asset-based fees, which are calculated as a percentage of assets under management. We also sell both admissions and sponsorship packages for our investment conferences and advertising on our websites and newsletters.

How we use your information depends on the product and service that you use and your relationship with us. We may use it to:

  • Verify your identity, personalize the content you receive, or create and administer your account.
  • Provide specific products and services to you, such as portfolio management or data aggregation.
  • Develop and improve features of our offerings.
  • Gear advertisements and other marketing efforts towards your interests.

To learn more about how we handle and protect your data, visit our privacy center.

Maintaining independence and editorial freedom is essential to our mission of empowering investor success. We provide a platform for our authors to report on investments fairly, accurately, and from the investor’s point of view. We also respect individual opinions––they represent the unvarnished thinking of our people and exacting analysis of our research processes. Our authors can publish views that we may or may not agree with, but they show their work, distinguish facts from opinions, and make sure their analysis is clear and in no way misleading or deceptive.

To further protect the integrity of our editorial content, we keep a strict separation between our sales teams and authors to remove any pressure or influence on our analyses and research.

Read our editorial policy to learn more about our process.