McKesson (MCK) AI Stock Analysis

• Market Cap: $99.97B
• Dividend Yield: 0.38%
• Average Volume (3M): 817.50K
• Price to Earnings (P/E): 25.2
• Beta (1Y): 0.25
• Revenue Growth: 17.23%
• EPS Growth: 66.17%
• Country: US
• Employees: 44,000
• Sector: Healthcare
• Sector Strength: 45
• Industry: Medical - Distribution
• EPS (TTM): 9.86
• Shares Outstanding: 123,426,650
• 10 Day Avg. Volume: 953,611
• 30 Day Avg. Volume: 817,504
• PEG Ratio: 1.77
• Price to Book (P/B): -41.34
• Price to Sales (P/S): 0.24
• P/FCF Ratio: 16.41
• Enterprise Value/Market Cap: 1.03
• Enterprise Value/Revenue: 0.27
• Enterprise Value/Gross Profit: 7.94
• Enterprise Value/Ebitda: 17.50
• 1Y Price Target: $935.33
• Price Target Upside: 15.97% Upside
• Rating Consensus: Strong Buy
• Number of Analyst Covering: 15
• EPS Forecast (FY): 38.69
• Revenue Forecast (FY): $408.20B

• Rating: 62 Neutral
• Price Target: $846.00 ▲(4.90% Upside)

McKesson's overall stock score reflects a strong earnings call performance and solid cash flow generation, which are offset by significant leverage concerns and bearish technical indicators. The company's raised guidance and strategic focus on high-growth areas are positive, but the financial instability and low profitability margins pose risks.

Positive Factors

Revenue Growth

Consistent revenue growth indicates strong market demand and effective business strategies, supporting long-term financial stability.

Strategic Restructuring

Restructuring to focus on high-growth segments like oncology and biopharma services positions McKesson for sustained competitive advantage.

Cash Flow Generation

Robust cash flow generation enhances McKesson's ability to invest in growth opportunities and manage debt, supporting long-term viability.

Negative Factors

Profitability Margins

Decreasing margins may limit McKesson's ability to reinvest in its business and maintain competitive pricing, impacting future profitability.

Leverage Concerns

Significant leverage can constrain financial flexibility and increase risk, potentially affecting McKesson's long-term financial health.

Medical-Surgical Segment Challenges

Stagnant performance in this segment could hinder overall growth and necessitate strategic adjustments to improve profitability.

McKesson Business Overview & Revenue Model

Company Description

McKesson Corporation is a global leader in healthcare supply chain management, dedicated to improving healthcare delivery through its extensive network of services. The company operates primarily in two segments: pharmaceutical distribution and medical-surgical distribution. McKesson provides a wide range of pharmaceutical products, including prescription and over-the-counter medications, as well as healthcare management software and automation solutions. Its core services support pharmacies, hospitals, and healthcare providers by ensuring they have the necessary products and services to deliver quality care.

How the Company Makes Money

McKesson generates revenue primarily through the distribution of pharmaceuticals and medical supplies. The company's key revenue streams include the wholesale distribution of branded and generic pharmaceuticals to pharmacies, hospitals, and other healthcare providers, which constitutes a significant portion of its total revenue. Additionally, McKesson provides integrated healthcare management solutions, generating revenue from software services and consulting. The company benefits from long-term contracts with large healthcare systems and partnerships with pharmaceutical manufacturers, enhancing its pricing power and operational efficiency. Furthermore, McKesson's participation in specialty pharmacy services and value-based care initiatives diversifies its income sources and supports its overall growth strategy.

McKesson Financial Statement Overview

Summary

McKesson shows solid revenue growth and strong cash flow generation, with a free cash flow growth of 11.30%. However, profitability margins are under pressure, and there are significant leverage concerns with a high debt-to-equity ratio of -5.05. The negative stockholders' equity and low net profit margin of 0.84% indicate financial instability.

Income Statement

McKesson's income statement shows a consistent revenue growth trend, with a TTM revenue growth rate of 2.52%. However, margins have been under pressure, with a declining gross profit margin from 4.97% in 2022 to 3.33% in TTM. The net profit margin is relatively low at 0.84%, indicating thin profitability. Despite these challenges, the company has managed to maintain positive EBIT and EBITDA margins.

Balance Sheet

The balance sheet reveals significant leverage concerns, with a negative stockholders' equity leading to a high debt-to-equity ratio of -5.05 in TTM. This indicates potential financial instability. The return on equity is negative, reflecting challenges in generating returns for shareholders. The equity ratio is also negative, highlighting the company's reliance on debt financing.

Cash Flow

Cash flow analysis shows strong free cash flow growth of 11.30% in TTM, indicating robust cash generation capabilities. The operating cash flow to net income ratio is healthy, suggesting efficient conversion of earnings into cash. The free cash flow to net income ratio of 0.88 further supports the company's ability to generate cash relative to its net income.

Breakdown	TTM	Dec 2025	Dec 2024	Dec 2023	Dec 2022	Dec 2021
Income Statement
Total Revenue	387.09B	359.05B	308.95B	276.71B	263.97B	238.23B
Gross Profit	12.96B	12.48B	12.20B	11.87B	12.65B	11.58B
EBITDA	5.88B	5.25B	4.67B	5.74B	3.11B	-3.60B
Net Income	4.03B	3.29B	3.00B	3.56B	1.11B	-4.54B
Balance Sheet
Total Assets	84.16B	75.14B	67.44B	62.32B	63.30B	65.02B
Cash, Cash Equivalents and Short-Term Investments	4.11B	5.69B	4.58B	4.68B	3.53B	6.28B
Total Debt	9.79B	7.39B	7.39B	7.29B	7.54B	9.40B
Total Liabilities	84.74B	76.83B	69.04B	63.81B	65.09B	63.57B
Stockholders Equity	-1.74B	-2.07B	-1.97B	-1.86B	-2.27B	-21.00M
Cash Flow
Free Cash Flow	6.39B	5.23B	3.63B	4.60B	3.90B	3.90B
Operating Cash Flow	6.87B	6.08B	4.31B	5.16B	4.43B	4.54B
Investing Cash Flow	-3.95B	-733.00M	-1.07B	-542.00M	-89.00M	-415.00M
Financing Cash Flow	-1.34B	-3.96B	-3.34B	-4.37B	-6.32B	-1.69B

McKesson Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 806.52
• 50DMA: Negative
• 100DMA: Positive
• 200DMA: Positive
• MACD: Positive
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For MCK, the sentiment is Negative. The current price of 806.52 is below the 20-day moving average (MA) of 833.81, below the 50-day MA of 820.78, and above the 200-day MA of 729.25, indicating a neutral trend. The MACD of -5.66 indicates Positive momentum. The RSI at 43.17 is Neutral, neither overbought nor oversold. The STOCH value of 58.06 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for MCK.

McKesson Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
HSIC	74 Outperform	$9.07B	24.21	11.39%	―	3.51%	29.65%
COR	70 Neutral	$66.29B	42.92	144.31%	0.66%	9.31%	5.92%
CAH	66 Neutral	$47.02B	29.87	―	1.02%	4.37%	28.48%
PBH	66 Neutral	$2.96B	15.46	11.29%	―	-0.02%	-1.87%
MCK	62 Neutral	$99.97B	25.22	―	0.38%	17.23%	66.17%
Sector *	51 Neutral	$7.86B	-0.30	-43.30%	2.27%	22.53%	-2.21%
OMI	42 Neutral	$239.77M	-0.18	-184.47%	―	-37.09%	-2639.44%

McKesson Corporate Events

McKesson Unveils Fiscal 2026 Guidance at Investor Day

On September 23, 2025, McKesson Corporation hosted its Investor Day, unveiling updated Fiscal 2026 guidance and long-term financial targets. The event highlighted the company’s strategic priorities, including strengthening North American pharmaceutical distribution, expanding oncology and biopharma services, and optimizing its portfolio. McKesson also introduced a new organizational structure to accelerate growth and enhance shareholder value, raising its Fiscal 2026 Adjusted Earnings per Diluted Share guidance and updating long-term growth targets, reflecting its strong market positioning and operational momentum.

McKesson Announces New Reporting Segments Restructure

McKesson Corporation announced that starting in the second quarter of fiscal 2026, it will report financial results across four new segments: North American Pharmaceutical, Oncology & Multispecialty, Prescription Technology Solutions, and Medical-Surgical Solutions. This restructuring reflects the company’s strategic focus on innovation and efficiency, and aims to provide clearer insights into its operations for stakeholders. Additionally, McKesson plans to sell its Norwegian operations, with the transaction expected to close following regulatory approvals.