CAH
HealthcareCardinal Health
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Market Data
Financials
XBRL · SEC EDGAR2009–2025(17yr)| Metric | FY 2009 | FY 2010 | FY 2011 | FY 2012 | FY 2013 | FY 2014 | FY 2015 | FY 2016 | FY 2017 | FY 2018 | FY 2019 | FY 2020 | FY 2021 | FY 2022 | FY 2023 | FY 2024 | FY 2025Latest | YoY |
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Revenue | $96.0B | $98.5B | $102.6B | $107.6B | $101.1B | $91.1B | $102.5B | $121.5B | $130.0B | $136.8B | $145.5B | $152.9B | $162.5B | $181.4B | $205.0B | $226.8B | $222.6B | -1.9% |
| Gross Profit | $3.7B | $3.8B | $4.2B | $4.5B | $4.9B | $5.2B | $5.7B | $6.5B | $6.5B | $7.2B | $6.8B | $6.9B | $6.8B | $6.5B | $6.9B | $7.4B | $8.2B | +10.2% |
| Gross Margin | 3.9% | 3.8% | 4.1% | 4.2% | 4.9% | 5.7% | 5.6% | 5.4% | 5.0% | 5.2% | 4.7% | 4.5% | 4.2% | 3.6% | 3.4% | 3.3% | 3.7% | +0.4pp |
| Operating Income | $1.3B | $1.3B | $1.5B | $1.8B | $996.0M | $1.9B | $2.2B | $2.5B | $2.1B | $126.0M | $2.1B | -$4.1B | $472.0M | -$596.0M | $727.0M | $1.2B | $2.3B | +83.0% |
| Operating Margin | 1.3% | 1.3% | 1.5% | 1.7% | 1.0% | 2.1% | 2.1% | 2.0% | 1.6% | 0.1% | 1.4% | -2.7% | 0.3% | -0.3% | 0.4% | 0.5% | 1.0% | +0.5pp |
| Net Income | $1.2B | $642.2M | $959.0M | $1.1B | $334.0M | $1.2B | $1.2B | $1.4B | $1.3B | $256.0M | $1.4B | -$3.7B | $611.0M | -$933.0M | $261.0M | $852.0M | $1.6B | +83.2% |
| Net Margin | 1.2% | 0.7% | 0.9% | 1.0% | 0.3% | 1.3% | 1.2% | 1.2% | 1.0% | 0.2% | 0.9% | -2.4% | 0.4% | -0.5% | 0.1% | 0.4% | 0.7% | +0.3pp |
| Free Cash Flow | $1.0B | $1.9B | $1.1B | $913.0M | $1.5B | $2.3B | $2.2B | $2.5B | $797.0M | $2.4B | $2.4B | $1.6B | $2.0B | $2.7B | $2.4B | $3.3B | $1.9B | -43.1% |
| FCF Margin | 1.0% | 1.9% | 1.1% | 0.8% | 1.5% | 2.5% | 2.2% | 2.1% | 0.6% | 1.7% | 1.6% | 1.0% | 1.2% | 1.5% | 1.2% | 1.4% | 0.8% | -0.6pp |
| EPS (Diluted) | $3.18 | $1.77 | $2.72 | $3.06 | $0.97 | $3.38 | $3.62 | $4.32 | $4.03 | $0.81 | $4.53 | $-12.61 | $2.08 | $-3.35 | $1.00 | $3.45 | $6.45 | +87.0% |
1. THE BIG PICTURE
Cardinal Health is a high-volume, low-margin middleman currently enjoying a surge in operational momentum that masks deep-seated structural vulnerabilities. While Cardinal Health recently reported a 19% jump in quarterly revenue and raised its full-year profit outlook, its long-term health is tethered to a single massive customer and the unpredictable outcome of federal anti-kickback investigations (8-K, Risks).
2. WHERE THE RISKS HIT HARDEST
The "prime vendor relationships" that Cardinal Health identifies as its primary competitive advantage are also its greatest point of failure (10-K Item 1). This strength is directly threatened by customer concentration risk because CVS Health represents 30% of fiscal 2025 revenue; the loss of this single relationship would effectively dismantle the scale required to operate in a low-margin environment (Risks). Furthermore, the "integrated technology solutions" management uses to differentiate its logistics and inventory services are vulnerable to regulatory sanctions. If the ongoing Civil Investigative Demand regarding potential Anti-Kickback Statute violations leads to a loss of eligibility for federal healthcare programs, Cardinal Health’s entire service-based value proposition to hospitals and physician offices would be compromised (10-K Item 1, Risks).
3. WHAT THE NUMBERS SAY TOGETHER
The financial data reveals a sharp disconnect between long-term trends and recent performance. While Cardinal Health’s TTMTTMTrailing Twelve Months — the most recent full year of financial data, updated on a rolling basis each quarter revenue growth is down 1.9%, its most recent quarter showed a 19% increase to $65.6 billion (XBRL, 8-K). This divergence is largely structural, driven by a 29% profit increase in the Pharmaceutical and Specialty Solutions segment, which benefited from brand and specialty pharmaceutical sales (8-K). However, compared to peers, Cardinal Health remains a laggard in growth, ranking 6th of 6 in TTMTTMTrailing Twelve Months — the most recent full year of financial data, updated on a rolling basis each quarter revenue expansion (XBRL). To compensate for this, Cardinal Health is aggressively returning capital, maintaining a 2.2% buyback yield—the second-highest among its peers—to support earnings per share even when the top line fluctuates (XBRL).
4. IS IT WORTH IT AT THIS PRICE?
At 18.8x forward earnings, Cardinal Health trades exactly in line with the peer median (XBRL). According to the CAPM analysis, the market is pricing in roughly 2.6% long-term growth. When including the 2.2% "lift" from share retirements, the implied EPSEPSEarnings Per Share — the company's net profit divided by its share count; the most common per-share profitability metric growth rate sits at 4.8%. This valuation is supported by management's decision to raise fiscal 2026 profit growth guidance for the Pharmaceutical segment to 20%–22% (8-K). However, investors are accepting a 0.8% net margin—drastically lower than medical device peers like Boston Scientific (14.2%) or Medtronic (13.9%)—which is typical for the distribution business model but leaves no room for error (XBRL). The current price is fair only if the recent quarterly momentum proves to be a permanent shift in volume rather than a temporary spike in specialty drug sales.
5. WHAT WOULD CHANGE THIS VIEW?
- Cautious if the CVS Health contract is renewed at significantly less favorable terms or if the 26% concentration in trade receivables leads to a liquidity strain (Risks).
- Constructive if the Global Medical Products and Distribution segment sustains its 106% profit growth, proving that cost optimization initiatives can permanently offset the adverse impact of tariffs (8-K).
- Cautious if legal expenses related to opioid litigation or the November 2023 Civil Investigative Demand exceed Cardinal Health's current cash flow capacity (Risks).
6. BOTTOM LINE
Structural Advantage: Massive distribution scale anchored by the Red Oak generic sourcing venture and a specialized network of nuclear pharmacies. Bottom Line: Cardinal Health is an essential but low-margin utility for the healthcare industry that is currently outperforming expectations, though its extreme reliance on CVS Health makes it a precarious long-term hold.
1. Top 5 Material Risks
- Regulatory and Licensing Compliance: Cardinal Health must maintain numerous permits and licenses to operate; failure to comply with complex federal, state, and foreign regulations can lead to product seizures, recalls, or the suspension of manufacturing and distribution activities.
- Healthcare Fraud and Abuse Investigations: Cardinal Health is subject to government investigations, including a November 2023 Civil Investigative Demand regarding potential Anti-Kickback Statute and False Claims Act violations, which could result in civil or criminal sanctions or the loss of eligibility for federal healthcare programs.
- Customer Concentration: CVS Health represents a significant portion of the business, accounting for 30 percent of fiscal 2025 revenue and 26 percent of the gross trade receivable balance as of June 30, 2025.
- Opioid-Related Litigation: Despite a 2022 settlement agreement, Cardinal Health remains a defendant in lawsuits from private plaintiffs and faces ongoing operational costs to maintain required anti-diversion programs, with potential for further unpredictable legal expenses.
- Supply Chain and Quality Control: Cardinal Health relies on third-party manufacturers and specific raw materials; quality issues—such as the April 2024 FDA warning letter regarding plastic syringes—can lead to costly product recalls, supply disruptions, and total or partial facility shutdowns.
2. Company-Specific Risks
- Generic Pharmaceutical Program Volatility: The profitability of the Pharma segment depends on generic pharmaceutical pricing and launch cycles, which have historically offset benefits from the Red Oak Sourcing venture with CVS Health; declines in this program directly impact consolidated operating earnings.
- Sterilization Compound Exposure: Cardinal Health relies on ethylene oxide (EtO) for medical product sterilization; increased regulatory enforcement to reduce emissions threatens to increase compliance costs and potentially cause industry-wide supply shortages.
- Integration of New Business Lines: Recent acquisitions, such as the Integrated Oncology Network and GI Alliance, involve entering new service areas like physician practice management, which carry unique risks related to fraud and abuse laws and potential legislative restrictions on corporate ownership of medical practices.
- Goodwill Impairment: Cardinal Health has recorded significant historical impairment charges, including $675 million in fiscal 2024 and $1.2 billion in fiscal 2023 related to the former Medical unit (GMPD), and remains susceptible to future charges if financial performance fails to meet long-term plans.
3. Regulatory/Legal Risks
- Data Privacy and Security: Cardinal Health handles sensitive patient-identifiable health information; evolving global regulations make compliance difficult and costly, with potential for civil or criminal penalties and reputational damage in the event of a breach.
- Tax Law Changes: Cardinal Health is subject to complex international tax laws; the July 2025 OBBBA legislation and ongoing IRS audits regarding fiscal 2021 tax positions (including a $966 million federal tax refund) create uncertainty regarding the effective tax rate and future cash flows.
- Trade and Import Restrictions: The Uyghur Forced Labor Prevention Act and various U.S. tariffs on foreign goods have caused supply constraints and increased sourcing costs, with the potential for further disruptions if Cardinal Health cannot find adequate alternative suppliers.
- Environmental Regulations: Climate-related laws may impose new costs for carbon reporting, data gathering, and capital expenditures for lower-emission technologies, which could negatively impact Cardinal Health’s competitive position.
4. Financial Impact Map
Regulatory Noncompliance → Results of Operations → Potential suspension of ability to distribute, import, or manufacture products. CVS Health Concentration → Revenue → 30 percent of fiscal 2025 revenue derived from this single customer. Opioid-Related Legal Proceedings → Cash Flows → Unpredictable impact from settlements, legal defense costs, and potential loss of insurance coverage. Generic Pharmaceutical Program Performance → Consolidated Operating Earnings → Declines in generic pricing or volume directly reduce segment profit. Goodwill Impairment → Earnings → Future charges to earnings if reporting unit fair values fall below carrying amounts.
Recent Filings
| Form | Filed | Period |
|---|---|---|
| 8-K | Feb 2026 | — |
| 10-Q | Feb 2026 | Dec 2025 |
| 14A | Sep 2025 | — |
| 10-K | Aug 2025 | Jun 2025 |
AI-extracted key facts from press releases and SEC filings. Significance 1–10.
Cardinal Health raises quarterly dividend to $0.5158 per share
- ▸Quarterly dividend increased to $0.5158 per share
- ▸Payable date set for July 15, 2026
- ▸Record date set for July 1, 2026
Cardinal Health increases quarterly dividend 1% to $0.5158 per share
- ▸Quarterly dividend increased to $0.5158 per share
- ▸Payable date set for July 15, 2026
- ▸Record date set for July 1, 2026
Cardinal Health generates $1.8B adjusted free cash flow YTD, leverage ratio hits 3.2x
- ▸Adjusted free cash flow $1.8B generated year-to-date
- ▸$1B returned to shareholders: $750M buybacks, $250M dividends
- ▸Leverage ratio improved to 3.2x, within 2.75x–3.25x target range
- ▸$240M allocated to capital expenditures for organic growth
- ▸Align Technology (ALGN) held $1.09B cash, repurchased $465.9M shares in 2025
Veeva Systems acquires AI engagement platform Ostro for approximately $100 million
- ▸Acquisition price approximately $100 million in cash and equity retention grants
- ▸Ostro provides AI-powered conversational engagement for life sciences industry
- ▸Platform enables real-time, compliant answers for patients and healthcare professionals
- ▸Ostro to operate as independent unit before integration into Commercial Cloud
- ▸Technology captures engagement data to refine pharmaceutical outreach strategies
Cardinal Health Q2 Pharma Segment Revenue +19% to $61B, Profit +29% to $687M
- ▸Pharma segment revenue $61B, up 19% YoY
- ▸Pharma segment profit $687M, up 29% YoY
- ▸GLP-1 medications contributed 6 percentage points to total revenue growth
- ▸Specialty drug revenue projected to exceed $50B in fiscal 2026
- ▸FY26 EPS estimates raised 25.1% to $10.31 per share over past year
Cardinal Health repurchases $427M in shares in Q4; analysts raise price targets
- ▸Q4 share repurchases totaled 2.32M shares for $426.96M
- ▸Total buyback program of $1.48B completed since June 2023
- ▸Barclays raises price target to $258, citing business strength
- ▸Citi upgrades to Buy, target $244, citing specialty asset growth
- ▸Rapiblyk distribution expanded in US via Cardinal Health partnership
Cardinal Health raises FY26 adjusted EPS guidance to $10.15–$10.35, targeting 23-26% growth
- ▸Raised FY26 adjusted EPS guidance to $10.15–$10.35
- ▸Projected 23–26% YoY EPS growth for fiscal 2026
- ▸Specialty segment revenue expected to exceed $50B in FY26
- ▸Growth driven by specialty distribution, biopharma services, and MSO platform expansion
- ▸Acquired Solaris Health to expand urology MSO footprint