Back to top

Analyst Blog

This page is temporarily not available.  Please check later as it should be available shortly. If you have any questions, please email customer support at support@zacks.com or call 800-767-3771 ext.  9339.

On Jun 3, 2013, we retained Cardinal Health, Inc. (CAH - Analyst Report) at Neutral based on its fiscal third quarter 2013 earnings results.

Why the Retention?

Cardinal Health announced results for the reported quarter on May 2.  The company posted adjusted earnings per share from continuing operations of $1.20, thereby beating the Zacks Consensus Estimate of 95 cents as well as the year-ago earnings of 94 cents per share.

Revenues in the fiscal third quarter were $24,552 million, down 9% on a year-over-year basis, almost in line with the Zacks Consensus Estimate of $24,635 million.

While margins are thin in the bulk pharmaceutical business, the business mix is evolving in favor of the non-bulk segment. Cardinal Health’s generics business showed continued signs of strength.

For fiscal 2013, Cardinal raised its forecast for adjusted earnings per share from continuing operations to a band of $3.67 and $3.71 (from $3.42 to $3.50 earlier).

In late Apr 2013, Cardinal Health revealed that it inked a fresh agreement to provide pharmaceutical products to a chain of distribution facilities and retail pharmacies of CVS Caremark Corporation (CVS - Analyst Report) till the middle of 2016.

However, the company has recently lost two important clients, Walgreen Co. (WAG - Analyst Report) and Express Scripts Holding Company (ESRX - Analyst Report). Loss of contracts with Walgreens and Express Scripts has negatively impacted revenue. However, the smaller Medical segment is now in a stable condition.

The Zacks Consensus Estimate for fiscal 2013 has moved up by 12 cents (3.4%) to $3.62 over the last 60 days. The Zacks Consensus Estimate for 2014 has moved down by 2 cents (0.6%) over the same timeframe. The stock carries a Zacks Rank #3 (Hold).

Please login to Zacks.com or register to post a comment.

New to Zacks?

Start Here

Zacks Investment Research

Close

Are you a new Zacks Member or a visitor to Zacks.com?

Top Zacks Features

Learn more

Start for as little as $4.50 per trade.

My Portfolio Tracker

Is it Time to Sell?

One of the most important steps you can take today is to set up your portfolio tracker on Zacks.com. Once you do, you'll be notified of major events affecting your stocks and/or funds with daily email alerts.

More Zacks Resources

Zacks Rank Home - Evaluate your stocks and use the Zacks Rank to eliminate the losers and keep the winners.

Mutual Fund Rank Home - Evaluate your funds with the Mutual Fund Rank for both your personal and retirement funds.

Stock/Mutual Fund Screening - Find better stocks and mutual funds. The ones most likely to beat the market and provide a positive return.

My Portfolio - Track your Portfolio and find out where your stocks/mutual funds stack up with the Zacks Rank.

Zacks #1 Rank Top Movers for Zacks #1 Rank Top Movers

Company Symbol Price %Chg
DIXIE GRP IN DXYN 15.84 +7.90%
BOFI HLDG IN BOFI 85.30 +4.97%
RAMBUS INC RMBS 12.31 +4.41%
VIPSHOP HOLD VIPS 148.73 +4.35%
NETFLIX INC NFLX 345.74 +4.32%