Wells Fargo analyst Stephen Baxter maintained a Hold rating on McKesson (MCK – Research Report) yesterday and set a price target of $641.00.
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Stephen Baxter’s rating is based on a combination of factors, including McKesson’s mixed financial performance and future guidance. The company’s recent earnings report showed a modest earnings per share beat, driven by strong performance in the Pharma and Corporate segments, but this was partially offset by weaker-than-expected results in the Med-Surg division. Despite an increase in revenue, it fell slightly short of expectations, and the gross profit was also below estimates, which indicates some underlying challenges.
Additionally, while McKesson raised its revenue growth guidance slightly and reaffirmed its long-term EPS growth targets, there remains some uncertainty regarding its 2026 outlook. The Med-Surg segment is expected to have flat growth due to a weaker illness season and primary care softness. These mixed signals, alongside cost management challenges, suggest a cautious approach, leading to the Hold rating as the company navigates these complexities.
Baxter covers the Healthcare sector, focusing on stocks such as Cardinal Health, UnitedHealth, and Cigna. According to TipRanks, Baxter has an average return of 3.5% and a 42.51% success rate on recommended stocks.