Cardinal Health Reports Better Than Expected Q4 Results

Cardinal Health (NYSE:CAH) experienced a drop of more than 6% intra-day today following Wells Fargo's initiation of the stock with an Underweight rating and a price target of $96 per share.

The analysts mentioned that while Cardinal Health's fundamentals are showing improvement, there are concerns regarding its relationship with Optum and the potential impact on the company. A key point of attention is the renewal of Cardinal Health's contract with Optum, set for June 2024. The analysts highlighted the uncertainty surrounding this renewal, especially since Optum seems to be moving towards handling some aspects of specialty distribution independently. This is evidenced by the recent opening of a large specialty distribution facility by Optum in Ohio.

Optum's operations constitute approximately 17% of Cardinal Health's pharmaceutical revenue but contribute a smaller percentage to its EBIT (Earnings Before Interest and Taxes). While the exact plans of Optum are not clear, analysts anticipate potential challenges to Cardinal Health's earnings and growth prospects due to these developments.

Cardinal Health (NYSE:CAH) experienced a drop of more than 6% intra-day today following Wells Fargo's initiation of the stock with an Underweight rating and a price target of $96 per share.

The analysts mentioned that while Cardinal Health's fundamentals are showing improvement, there are concerns regarding its relationship with Optum and the potential impact on the company. A key point of attention is the renewal of Cardinal Health's contract with Optum, set for June 2024. The analysts highlighted the uncertainty surrounding this renewal, especially since Optum seems to be moving towards handling some aspects of specialty distribution independently. This is evidenced by the recent opening of a large specialty distribution facility by Optum in Ohio.

Optum's operations constitute approximately 17% of Cardinal Health's pharmaceutical revenue but contribute a smaller percentage to its EBIT (Earnings Before Interest and Taxes). While the exact plans of Optum are not clear, analysts anticipate potential challenges to Cardinal Health's earnings and growth prospects due to these developments.

Cardinal Health (NYSE:CAH) released its Q4 results today, surpassing Street expectations. The adjusted earnings per share (EPS) stood at $1.55, representing a significant growth from the previous year's figure of $1.05. This exceeded the Street estimate of $1.49.

The company's revenue also exhibited a strong upward trajectory, reaching a total of $53.45 billion. This marked a 13% year-over-year increase and surpassed the projected revenue of $52.7 billion. Within this, the pharmaceutical revenue segment reached an impressive $49.7 billion, showcasing a 15% year-over-year rise and surpassing the projected revenue of $48.96 billion.

In light of this exceptional performance during Q4, Cardinal Health has revised its non-GAAP EPS guidance for the fiscal year 2024. The new projected range stands at $6.50 to $6.75, up from the previous range of $6.45 to $6.70.

Cardinal Health (NYSE:CAH) released its Q4 results today, surpassing Street expectations. The adjusted earnings per share (EPS) stood at $1.55, representing a significant growth from the previous year's figure of $1.05. This exceeded the Street estimate of $1.49.

The company's revenue also exhibited a strong upward trajectory, reaching a total of $53.45 billion. This marked a 13% year-over-year increase and surpassed the projected revenue of $52.7 billion. Within this, the pharmaceutical revenue segment reached an impressive $49.7 billion, showcasing a 15% year-over-year rise and surpassing the projected revenue of $48.96 billion.

In light of this exceptional performance during Q4, Cardinal Health has revised its non-GAAP EPS guidance for the fiscal year 2024. The new projected range stands at $6.50 to $6.75, up from the previous range of $6.45 to $6.70.

Cardinal Health, Inc. (NYSE:CAH) shares rose more than 11% since the company’s reported Q4 results last week, with revenue of $47.1 billion coming in better than the Street estimate of $44.75 billion. Quarterly EPS was $1.05, missing the Street estimate of $1.17.

For the full 2023-year, the company expects EPS to be in the range of $5.05-$5.40, compared to the Street estimate of $5.37.

Analysts at Deutsche Bank raised their price target on the company’s shares to $69 from $51 following the earnings announcement. According to the analysts, the core pharmaceutical segment outperformed expectations, delivering better than expected revenue (up 13%), operating earnings (up 26%) and margin of 1.04%.

The analysts think the Medical segment continues to be the trouble spot for the company, being plagued by demand volatility, inflationary pressures, rising transportation costs, and the optics of the divestiture of the Cordis business.

Cardinal Health, Inc. (NYSE:CAH) shares rose more than 11% since the company’s reported Q4 results last week, with revenue of $47.1 billion coming in better than the Street estimate of $44.75 billion. Quarterly EPS was $1.05, missing the Street estimate of $1.17.

For the full 2023-year, the company expects EPS to be in the range of $5.05-$5.40, compared to the Street estimate of $5.37.

Analysts at Deutsche Bank raised their price target on the company’s shares to $69 from $51 following the earnings announcement. According to the analysts, the core pharmaceutical segment outperformed expectations, delivering better than expected revenue (up 13%), operating earnings (up 26%) and margin of 1.04%.

The analysts think the Medical segment continues to be the trouble spot for the company, being plagued by demand volatility, inflationary pressures, rising transportation costs, and the optics of the divestiture of the Cordis business.