Domo signs strategic collaboration agreement with AWS for AI solutions
On Wednesday, Mizuho (NYSE:MFG) Securities displayed confidence in Cencora Inc (NYSE: COR), as analyst Steven Valiquette increased the company's price target to $305 from $280, while reiterating an Outperform rating. Currently trading at $274.73 and approaching its 52-week high of $296.65, Cencora has shown strong momentum with a 24.78% return over the past six months. The adjustment follows a series of positive developments for Cencora, including the successful launch of a biosimilar product and robust earnings from its largest customer. According to InvestingPro, the company maintains a GREAT overall financial health score.
Valiquette cited the recent introduction of a biosimilar version of Eylea as a significant boon for Cencora's specialty ophthalmology distribution network. This comes on the heels of Cencora's strategic acquisition of RCA ophthalmology, which was finalized approximately three to four months ago. The analyst believes that this move will further strengthen the company's position in the market. With revenue growth of 11.64% and a market capitalization of $53.27 billion, Cencora has established itself as a prominent player in the Healthcare Providers & Services industry.
The upbeat assessment was further supported by the strong financial performance of Walgreens, Cencora's largest customer, which reported better-than-expected earnings for the second quarter of fiscal year 2025 on Tuesday. This news has been viewed as indicative of potential positive momentum for Cencora.
Moreover, Mizuho's Generic Rx and Biosimilar Pipeline Tracker is expected to continue providing catalysts throughout the year, which could further drive Cencora's growth. Valiquette also noted that Cencora's exposure to tariffs is minimal compared to its industry peers, given the absence of a Medical (TASE:BLWV) segment within its business. He suggested that any tariffs could actually serve as a modest tailwind due to short-term gains on existing prescription inventory.
In light of these factors, the analyst has revised the company's fiscal year 2025 earnings per share (EPS) estimate upwards from $15.30 to $15.50, slightly ahead of the Street's current $15.41 consensus. For fiscal year 2026, the EPS estimate has been lifted from $16.80 to $17.05, surpassing the Street's projection of $16.91. The new price target reflects a higher price-to-earnings (P/E) multiple of 17 times, up from the previous 16 times, applied to the updated calendar year 2026 EPS estimate. With a current P/E ratio of 38.84 and notably low price volatility (beta: 0.54), InvestingPro analysis suggests the stock is currently trading near its Fair Value. Discover 14 additional key insights and comprehensive valuation metrics for Cencora through InvestingPro's detailed research reports, available along with 1,400+ other top US stocks.
In other recent news, Cencora, Inc. reported significant developments following its Annual Meeting, where shareholders approved executive compensation and elected directors. The election confirmed the appointment of all nominated board members, and the advisory resolution on executive compensation passed with a majority. Additionally, Ernst & Young LLP was ratified as the independent registered public accounting firm for the fiscal year 2025. Leerink Partners raised their price target for Cencora to $301, maintaining an Outperform rating due to the company's strong first-quarter fiscal year 2025 results and robust performance in the U.S. Healthcare sector. Despite a slight decrease in international guidance, Leerink's confidence in Cencora's market position remains high. In other corporate news, Cencora announced the upcoming retirement of board members Richard W. Gochnauer and Kathleen W. Hyle, effective at the next Annual Meeting. Their departure will reduce the board size from 13 to 11 members, with no successors announced yet. These developments reflect Cencora's ongoing strategic adjustments and market confidence.
This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.