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DUBLIN, Ohio - Cardinal Health (NYSE:CAH), currently trading near its 52-week high with a market cap of $36.6 billion, raised its fiscal year 2025 non-GAAP diluted earnings per share guidance to $8.15-$8.20 from $8.05-$8.15 and established preliminary fiscal year 2026 guidance of $9.10-$9.30, representing 13% growth at the midpoint. According to InvestingPro analysis, the company appears undervalued based on its Fair Value calculations, with 14 additional ProTips available for subscribers.
The healthcare products and services distributor announced these updates during its Investor Day on Thursday, where it also confirmed a long-term target of 12-14% compound annual growth rate for non-GAAP diluted EPS from fiscal years 2026 to 2028. The company’s strong financial health is reflected in its "GREAT" overall score from InvestingPro, supported by its impressive 58% stock return over the past year and 43-year track record of consistent dividend payments.
Cardinal Health raised its long-term profit growth targets for its Pharmaceutical and Specialty Solutions segment to 5-7% normalized growth and its Other segment to approximately 10% normalized growth. The company also updated its Global Medical Products and Distribution target to more than $50 million of profit growth per year after fiscal year 2026.
"We are proud of the strong and resilient foundation we have built that enables us to deliver compelling future growth," said Jason Hollar, Chief Executive Officer of Cardinal Health.
The company expects to generate at least $10 billion in total adjusted free cash flow over the next three years and has increased its baseline share repurchase plans to at least $750 million per year, up from the previous $500 million annual baseline.
Cardinal Health also announced several strategic initiatives, including the launch of The Specialty Alliance multi-specialty MSO platform, investments in Biopharma Solutions, and plans to build a new state-of-the-art forward distribution center.
Additionally, the company plans to invest over $150 million in its Nuclear and Precision Health Solutions business over the next three years to support theranostics and PET product pipeline development.
The information in this article is based on a press release statement from Cardinal Health.
In other recent news, Cardinal Health has been actively engaged in several developments that are of interest to investors. The company is expected to present updated fiscal year 2026 guidance, with preliminary adjusted earnings per share (EPS) forecasted between $9.15 and $9.45, which is slightly above the consensus estimate of $9.14. Analysts from TD Cowen anticipate that Cardinal Health will address its Other segment and businesses, which are projected to contribute 18% of adjusted operating income in 2026. Meanwhile, BofA Securities has raised its price target for Cardinal Health to $170, up from $165, maintaining a Buy rating, as the company prepares for its upcoming investor day.
Cardinal Health has also partnered with Citius Oncology to distribute LYMPHIR™, an FDA-approved immunotherapy, in the U.S., marking a strategic move to enhance its specialty pharmaceutical distribution services. Wells Fargo analysts have upgraded Cardinal Health to Overweight, increasing the price target to $179 from $136, due to improved valuation and a strong industry backdrop. The analysts have adjusted their EPS estimates for Cardinal Health upwards for the years 2025 through 2027, reflecting the company’s recent outperformance and strategic acquisitions. These updates underscore Cardinal Health’s ongoing efforts to strengthen its market position and financial outlook.
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