McKesson (MCK) AI Stock Analysis

• Market Cap: $104.69B
• Dividend Yield: 0.36%
• Average Volume (3M): 688.27K
• Price to Earnings (P/E): 33.6
• Beta (1Y): 0.26
• 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: 124,384,390
• 10 Day Avg. Volume: 625,815
• 30 Day Avg. Volume: 688,275
• 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: 0.00
• Enterprise Value/Revenue: 0.00
• Enterprise Value/Gross Profit: 0.00
• Enterprise Value/Ebitda: 0.00
• 1Y Price Target: $887.75
• Price Target Upside: 3.39% Upside
• Rating Consensus: Strong Buy
• Number of Analyst Covering: 15
• EPS Forecast (FY): N/A
• Revenue Forecast (FY): N/A

• Rating: 70 Outperform
• Price Target: $926.00 ▲(7.85% Upside)

McKesson's strong earnings performance and positive technical indicators are significant strengths, contributing to a favorable outlook. However, high leverage and valuation concerns present risks. The company's raised guidance and strategic focus on high-growth areas provide confidence in its future prospects, but financial sustainability requires addressing balance sheet challenges.

Positive Factors

Revenue Growth

Consistent revenue growth indicates strong demand for McKesson's services and supports long-term business expansion and market leadership.

Strategic Initiatives

The new reporting structure aligns with strategic growth areas, potentially optimizing operations and enhancing long-term shareholder value.

Cash Flow Generation

Strong cash flow generation enhances financial stability, providing a buffer against high leverage and supporting future investments.

Negative Factors

High Leverage

Significant leverage poses financial risk, potentially limiting flexibility and increasing vulnerability to economic downturns.

Low Profit Margins

Declining profit margins may impact profitability, necessitating cost management improvements to sustain long-term financial health.

Medical-Surgical Solutions Challenges

Flat revenue growth in Medical-Surgical Solutions indicates potential operational challenges, affecting overall growth and profitability.

McKesson Business Overview & Revenue Model

Company Description

McKesson Corporation provides healthcare services in the United States and internationally. It operates through four segments: U.S. Pharmaceutical, International, Medical-Surgical Solutions, and Prescription Technology Solutions (RxTS). The U.S. Pharmaceutical segment distributes branded, generic, specialty, biosimilar, and over-the-counter pharmaceutical drugs and other healthcare-related products. This segment also provides practice management, technology, clinical support, and business solutions to community-based oncology and other specialty practices; and consulting, outsourcing, technological, and other services, as well as sells financial, operational, and clinical solutions to pharmacies. The International segment offers distribution and services to wholesale, institutional, and retail customers in 13 European countries and Canada. The Medical-Surgical Solutions segment provides medical-surgical supply distribution, logistics, and other services to healthcare providers. The RxTS segment serves biopharma and life sciences partners and patients to address medication challenges for patients throughout their journeys; connects pharmacies, providers, payers, and biopharma companies to deliver innovative access and adherence solutions; and provides third-party logistics and wholesale distribution support solutions. McKesson Corporation was founded in 1833 and is headquartered in Irving, Texas.

How the Company Makes Money

McKesson generates revenue primarily through its pharmaceutical distribution segment, which involves the sale of branded and generic pharmaceuticals to hospitals, pharmacies, and other healthcare providers. This segment accounts for a significant portion of the company's revenue, driven by the volume of drugs distributed and the associated service fees. Additionally, McKesson earns revenue from its medical-surgical distribution services, where it supplies medical supplies and equipment to healthcare facilities. Another key revenue stream comes from its technology solutions, which include software and services designed to streamline healthcare operations and enhance patient care delivery. The company also benefits from strategic partnerships with pharmaceutical manufacturers and healthcare providers, allowing it to optimize its supply chain, enhance service offerings, and tap into new markets. Overall, McKesson's diverse revenue model, supported by its scale and industry relationships, contributes to its financial stability and growth.

McKesson Financial Statement Overview

Summary

McKesson shows solid revenue growth and strong cash flow generation, which are positive indicators of financial health. However, the company faces challenges with low profit margins and high leverage, as reflected in its negative equity position. While the cash flow strength provides some stability, the balance sheet risks need to be addressed to ensure long-term financial sustainability.

Income Statement

McKesson's income statement shows a consistent revenue growth trajectory, with a TTM revenue growth rate of 5.17%. However, the gross profit margin has been declining over the years, from 5.10% in 2021 to 3.33% in TTM. The net profit margin has improved slightly to 0.84% in TTM, indicating better cost management. Despite these improvements, the margins remain relatively low, which is typical for the distribution industry.

Balance Sheet

The balance sheet reveals a concerning negative stockholders' equity, resulting in a high debt-to-equity ratio of -5.05 in TTM. This indicates significant leverage and potential financial risk. 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

McKesson's cash flow statement is strong, with a TTM free cash flow growth rate of 9.91%. The operating cash flow to net income ratio is healthy at 0.10, and the free cash flow to net income ratio is robust at 0.88, indicating efficient cash generation relative to net income. This strong cash flow performance provides a buffer against the high leverage seen in the balance sheet.

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	4.00B	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	76.88B	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: Positive
• Last Price: 858.61
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Negative
• STOCH: Negative

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For MCK, the sentiment is Positive. The current price of 858.61 is above the 20-day moving average (MA) of 802.95, above the 50-day MA of 754.01, and above the 200-day MA of 697.23, indicating a bullish trend. The MACD of 25.21 indicates Negative momentum. The RSI at 75.43 is Negative, neither overbought nor oversold. The STOCH value of 86.22 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for MCK.

McKesson Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
COR	76 Outperform	$66.80B	35.44	129.89%	0.62%	9.31%	5.92%
MCK	70 Outperform	$104.69B	33.58	―	0.36%	17.23%	66.17%
HSIC	69 Neutral	$8.43B	22.75	11.39%	―	3.51%	29.65%
CAH	65 Neutral	$46.41B	29.49	―	1.04%	4.37%	28.48%
PBH	63 Neutral	$2.98B	14.04	12.05%	―	0.63%	4.23%
Sector *	51 Neutral	$7.86B	-0.30	-43.30%	2.27%	22.53%	-2.21%
OMI	38 Underperform	$269.94M	―	-184.47%	―	-37.09%	-2639.44%

McKesson Corporate Events

McKesson Reports Record Revenue and Raises EPS Guidance

McKesson Corporation is a diversified healthcare services leader that partners with various stakeholders to improve health outcomes by providing insights, products, and services in the healthcare sector. In its fiscal 2026 second quarter earnings report, McKesson Corporation announced record-high quarterly revenues of $103.2 billion, marking a 10% increase from the previous year, and raised its full-year adjusted EPS guidance. The company reported significant growth in its North American Pharmaceutical and Oncology & Multispecialty segments, with adjusted earnings per diluted share rising by 39% to $9.86. McKesson’s strategic focus on oncology and multispecialty services, along with disciplined execution, has driven sustainable long-term growth. The company generated $2.4 billion in cash flow from operations and returned $1.6 billion to shareholders in the first half of the fiscal year. Looking ahead, McKesson remains confident in its ability to create value for stakeholders and has raised its fiscal 2026 adjusted EPS guidance to a range of $38.35 to $38.85, reflecting anticipated growth of 16% to 18% compared to the prior year.

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.

The most recent analyst rating on (MCK) stock is a Buy with a $810.00 price target. To see the full list of analyst forecasts on McKesson stock, see the MCK Stock Forecast page.

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.

The most recent analyst rating on (MCK) stock is a Buy with a $800.00 price target. To see the full list of analyst forecasts on McKesson stock, see the MCK Stock Forecast page.

McKesson’s Earnings Call Highlights Strong Growth and Strategic Moves

McKesson Corporation’s recent earnings call painted a picture of robust financial health and strategic foresight. The company reported substantial revenue growth and successful strategic acquisitions, which contributed to a strong performance this quarter. Despite challenges such as Rite Aid’s bankruptcy and the exit from European operations, McKesson demonstrated effective operational execution and raised its full-year guidance, signaling a positive outlook for the future.

McKesson Corporation Reports Strong Q1 2026 Results

McKesson Corporation is a leading healthcare services company that partners with biopharma companies, care providers, and pharmacies to deliver products and services that enhance healthcare access and affordability. Operating in the healthcare sector, McKesson is known for its comprehensive distribution network and innovative solutions in oncology and specialty pharmaceuticals.