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On Tuesday, Wells Fargo (NYSE:WFC) analysts upgraded Cencora Inc (NYSE: COR) stock from Equal Weight to Overweight, citing a favorable industry environment and limited exposure to macroeconomic and policy risks. The analysts also raised the price target for Cencora shares to $337 from $274. The stock, currently trading at $292.07, has shown impressive momentum with a 30.5% gain year-to-date. According to InvestingPro data, which offers comprehensive analysis of 1,400+ stocks, Cencora maintains an overall "GREAT" financial health score of 3.13 out of 5.
The upgrade reflects the analysts’ view that Cencora’s valuation is supported by a robust industry backdrop. They noted that Cencora’s limited exposure to medical tariffs and Most Favored Nations drug pricing policy offers a competitive advantage over peers like McKesson Corporation (NYSE:MCK). The analysts believe this positioning reduces Cencora’s vulnerability to certain market risks. With a beta of 0.57 and consistently low price volatility, InvestingPro analysis shows the stock offers relative stability in the healthcare sector. Discover 13 more exclusive insights about Cencora with an InvestingPro subscription.
Wells Fargo’s estimates suggest Cencora’s core earnings before interest and taxes (EBIT) growth could reach approximately 17% for fiscal year 2025 and about 9% for fiscal year 2026. These projections are slightly above Cencora’s long-term growth targets, with the analysts expressing confidence in the company’s ability to achieve these figures amidst current market conditions.
The analysts also adjusted their earnings per share (EPS) estimates for Cencora, increasing them by 1.9% for 2025, 2.4% for 2026, and 2.6% for 2027. These changes reflect continued strong industry trends and adjustments related to mergers and acquisitions. The analysts expect Cencora’s earnings stream to remain relatively stable compared to its competitors.
Wells Fargo’s new price target for Cencora is based on a valuation of 18 times the next twelve months’ earnings per share, which aligns with the current price-to-earnings multiple. The analysts see this valuation as justified given the strong industry conditions and potential for upward revisions in estimates. The company’s revenue growth of 12.2% in the last twelve months and market capitalization of $56.6 billion reflect its position as a prominent player in the Healthcare Providers & Services industry. For detailed valuation metrics and comprehensive analysis, access the full Pro Research Report on InvestingPro.
In other recent news, Cencora Inc. reported a strong financial performance for the first quarter of 2025, surpassing analysts’ expectations. The company achieved an adjusted earnings per share (EPS) of $4.42, which exceeded the forecasted $4.06, and reported revenue of $75.5 billion, surpassing the anticipated $75.14 billion. This robust performance was primarily driven by significant gains in the U.S. Healthcare Solutions segment. Cencora also raised its full-year guidance for adjusted diluted EPS to a range of $15.70 to $15.95, reflecting optimism for continued growth.
Additionally, Cencora announced the appointment of Lori J. Ryerkerk to its Board of Directors, effective June 1, 2025. Ryerkerk’s expertise in global supply chain management is expected to enhance the board’s capabilities and contribute to the company’s long-term growth strategy. Cencora’s strategic focus includes expanding its leadership in specialty medications and strengthening its international market presence.
The company’s recent acquisition of Retina Consultants of America (RCA) has also been integrated, contributing positively to its gross profit margins. Cencora’s ongoing commitment to enhancing its board and expanding its services demonstrates its focus on driving value for stakeholders and maintaining a strong market position.
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