Cardinal Health (CAH) AI Stock Analysis

• Market Cap: $36.91B
• Dividend Yield: 1.36%
• Average Volume (3M): 2.36M
• Price to Earnings (P/E): 24.0
• Beta (1Y): 0.43
• Revenue Growth: -1.94%
• EPS Growth: 85.70%
• Country: US
• Employees: 47,922
• Sector: Healthcare
• Sector Strength: 45
• Industry: Medical - Distribution
• EPS (TTM): 2.08
• Shares Outstanding: 238,793,640
• 10 Day Avg. Volume: 2,270,584
• 30 Day Avg. Volume: 2,357,829
• PEG Ratio: N/A
• Price to Book (P/B): N/A
• Price to Sales (P/S): N/A
• P/FCF Ratio: N/A
• Enterprise Value/Market Cap: 1.24
• Enterprise Value/Revenue: 0.21
• Enterprise Value/Gross Profit: 5.62
• Enterprise Value/Ebitda: 14.79
• 1Y Price Target: $183.09
• Price Target Upside: 19.11% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 11

• Rating: 65 Neutral
• Price Target: $165.00 ▲(7.35% Upside)

Cardinal Health's overall stock score is driven by strong earnings growth and strategic acquisitions, which are expected to enhance future performance. However, significant financial leverage and cash flow management issues present risks. The technical indicators suggest a mild bullish trend, while the valuation appears relatively high, limiting upside potential.

Positive Factors

Revenue Growth

The significant growth in the Pharmaceutical segment demonstrates Cardinal Health's strong market position and ability to capitalize on demand for branded and specialty pharmaceuticals, which is crucial for sustained revenue expansion.

Strategic Acquisitions

The acquisition of Solaris Health is a strategic move to enhance Cardinal Health's specialty solutions, expanding its multi-specialty MSO platform. This positions the company for long-term growth by broadening its service offerings and strengthening its competitive edge.

Free Cash Flow

The strong free cash flow performance, exceeding expectations by $500 million, underscores Cardinal Health's effective cash management and operational efficiency, providing financial flexibility for future investments and shareholder returns.

Negative Factors

High Financial Leverage

The significant leverage indicated by a negative debt-to-equity ratio poses financial risks, potentially limiting Cardinal Health's ability to invest in growth opportunities and impacting its long-term financial stability.

SG&A Expenses

The rise in SG&A expenses, driven by acquisitions and investments, could pressure margins if not managed effectively, potentially affecting profitability and requiring strategic cost control measures.

Tariff Challenges

Tariff-related challenges in the GMPD segment highlight external risks that could impact cost structures and profitability. Ongoing efforts to mitigate these impacts are crucial for maintaining competitive pricing and margins.

Cardinal Health Business Overview & Revenue Model

Company Description

Cardinal Health, Inc. operates as an integrated healthcare services and products company in the United States, Canada, Europe, Asia, and internationally. It provides customized solutions for hospitals, healthcare systems, pharmacies, ambulatory surgery centers, clinical laboratories, physician offices, and patients in the home. The company operates in two segments, Pharmaceutical and Medical. The Pharmaceutical segment distributes branded and generic pharmaceutical, specialty pharmaceutical, and over-the-counter healthcare and consumer products. The segment also provides services to pharmaceutical manufacturers and healthcare providers for specialty pharmaceutical products; operates nuclear pharmacies and radiopharmaceutical manufacturing facilities; repackages generic pharmaceuticals and over-the-counter healthcare products; and offers medication therapy management and patient outcomes services to hospitals, other healthcare providers, and payers, as well as provides pharmacy management services to hospitals. The Medical segment manufactures, sources, and distributes Cardinal Health branded medical, surgical, and laboratory products and devices that include exam and surgical gloves; needles, syringe, and sharps disposals; compressions; incontinences; nutritional delivery products; wound care products; single-use surgical drapes, gowns, and apparels; fluid suction and collection systems; urology products; operating room supply products; and electrode product lines. The segment also distributes a range of national brand products, including medical, surgical, and laboratory products; provides supply chain services and solutions to hospitals, ambulatory surgery centers, clinical laboratories, and other healthcare providers; and assembles and sells sterile, and non-sterile procedure kits. The company was incorporated in 1979 and is headquartered in Dublin, Ohio.

How the Company Makes Money

Cardinal Health generates revenue primarily through two key segments: Pharmaceutical and Medical. In the Pharmaceutical segment, the company earns money by distributing branded and generic pharmaceuticals, as well as providing related services such as inventory management and pharmacy solutions to healthcare providers. The Medical segment generates revenue through the sale of medical products, surgical supplies, and equipment to hospitals and healthcare facilities. Additionally, Cardinal Health benefits from long-term contracts with various healthcare providers, which ensure a steady stream of income. Strategic partnerships with manufacturers and leveraging technology for supply chain efficiencies also contribute to its earnings. The company's ability to negotiate favorable pricing with suppliers and manage logistics effectively enhances its profitability.

Cardinal Health Financial Statement Overview

Summary

Cardinal Health shows strong revenue growth and improving operational margins, but faces significant challenges with its balance sheet due to high leverage and negative equity. Cash flow management needs attention, as declining free cash flow could impact liquidity. Strategic initiatives to strengthen the balance sheet and enhance cash flow generation are crucial for long-term financial health.

Income Statement

Cardinal Health has demonstrated strong revenue growth with a 13.1% increase in the latest year, reflecting robust demand in the medical distribution sector. The gross profit margin has improved slightly to 3.67%, indicating better cost management. However, the net profit margin remains low at 0.70%, suggesting challenges in translating revenue growth into net income. The EBIT and EBITDA margins have shown improvement, but remain modest, highlighting potential areas for operational efficiency gains.

Balance Sheet

The balance sheet reveals a concerning negative stockholders' equity, resulting in a high debt-to-equity ratio of -3.07. This indicates significant leverage and potential financial risk. The return on equity is negative, reflecting the challenges in generating returns for shareholders. The equity ratio is also negative, suggesting a weak capital structure. These factors highlight the need for strategic financial restructuring to improve stability.

Cash Flow

Operating cash flow remains positive, but the free cash flow has declined by 24.1%, indicating potential cash management issues. The operating cash flow to net income ratio is low at 0.06, suggesting limited cash generation relative to net income. The free cash flow to net income ratio is healthier at 0.77, but the decline in free cash flow growth raises concerns about future liquidity.

Breakdown	TTM	Dec 2025	Dec 2024	Dec 2023	Dec 2022	Dec 2021
Income Statement
Total Revenue	222.58B	222.58B	226.83B	204.98B	181.33B	162.47B
Gross Profit	8.17B	8.17B	7.41B	6.89B	6.48B	6.78B
EBITDA	3.11B	3.11B	1.96B	1.44B	55.00M	1.29B
Net Income	1.56B	1.56B	852.00M	330.00M	-938.00M	611.00M
Balance Sheet
Total Assets	53.12B	53.12B	45.12B	43.35B	43.88B	44.45B
Cash, Cash Equivalents and Short-Term Investments	3.87B	3.87B	5.13B	4.08B	4.72B	3.41B
Total Debt	8.53B	8.53B	5.09B	4.70B	5.32B	6.24B
Total Liabilities	55.76B	55.76B	48.33B	46.31B	44.58B	42.66B
Stockholders Equity	-2.78B	-2.78B	-3.21B	-2.96B	-709.00M	1.79B
Cash Flow
Free Cash Flow	1.85B	1.85B	3.25B	2.36B	2.73B	2.03B
Operating Cash Flow	2.40B	2.40B	3.76B	2.84B	3.12B	2.43B
Investing Cash Flow	-5.61B	-5.61B	-1.85B	-454.00M	567.00M	-378.00M
Financing Cash Flow	1.95B	1.95B	-847.00M	-3.05B	-2.46B	-1.32B

Cardinal Health Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 153.71
• 50DMA: Positive
• 100DMA: Negative
• 200DMA: Positive
• MACD: Negative
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For CAH, the sentiment is Positive. The current price of 153.71 is above the 20-day moving average (MA) of 150.47, above the 50-day MA of 152.41, and above the 200-day MA of 141.07, indicating a bullish trend. The MACD of <0.01 indicates Negative momentum. The RSI at 54.48 is Neutral, neither overbought nor oversold. The STOCH value of 58.00 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for CAH.

Cardinal Health Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
HSIC	69 Neutral	8.01B	21.24	11.29%	―	2.29%	14.98%
MCK	69 Neutral	94.60B	29.39	-160.85%	0.39%	20.35%	11.96%
CAH	65 Neutral	$36.91B	23.96	-43.80%	1.36%	-1.94%	85.70%
PBH	65 Neutral	3.10B	14.77	11.48%	―	0.63%	4.23%
COR	59 Neutral	59.52B	30.74	95.81%	0.72%	11.56%	5.31%
OMI	41 Neutral	368.45M	-0.31	428.07%	―	-17.10%	-2720.40%
Sector *	51 Neutral	$7.86B	-0.30	-43.30%	2.27%	22.53%	-2.21%

Cardinal Health Corporate Events

Cardinal Health Completes $1 Billion Notes Offering

On August 27, 2025, Cardinal Health completed a public offering of $1 billion in notes, with proceeds intended to fund part of its proposed acquisition of Solaris Health. If the acquisition is not completed by August 12, 2026, or if Cardinal Health decides not to pursue it, the company will be required to redeem the notes at a premium.

The most recent analyst rating on (CAH) stock is a Hold with a $155.00 price target. To see the full list of analyst forecasts on Cardinal Health stock, see the CAH Stock Forecast page.

Cardinal Health Secures $1 Billion in Notes Sale

On August 13, 2025, Cardinal Health entered into an underwriting agreement with major financial institutions for the sale of $1 billion in notes, consisting of $600 million in 4.500% Notes due 2030 and $400 million in 5.150% Notes due 2035. This financial maneuver is part of Cardinal Health’s strategy to optimize its capital structure, potentially impacting its market positioning and offering implications for investors and stakeholders in terms of financial stability and growth prospects.

The most recent analyst rating on (CAH) stock is a Hold with a $110.00 price target. To see the full list of analyst forecasts on Cardinal Health stock, see the CAH Stock Forecast page.