We use cookies to understand how you use our site and to improve your experience. This includes personalizing content and advertising. To learn more, click here. By continuing to use our site, you accept our use of cookies, revised Privacy Policy and Terms of Service.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
Cardinal Health (CAH) Beats on Q3 Earnings, Ups '23 EPS View
Read MoreHide Full Article
Cardinal Health, Inc. (CAH - Free Report) reported fiscal third-quarter 2023 adjusted earnings of $1.74 per share (EPS), which beat the Zacks Consensus Estimate of $1.48 by 17.6%. The bottom line also improved 20% year over year.
GAAP earnings per share in the quarter was $1.34 against the year-ago quarter’s loss of $5.05 per share. The significant gain was primarily due to growth in revenues.
Revenue Details
Sales improved 13% on a year-over-year basis to $50.5 billion. The top line also outpaced the Zacks Consensus Estimate by 1.7%.
Segmental Analysis
Pharmaceutical Segment
In the reported quarter, pharmaceutical revenues increased 14% to $46.8 billion on a year-over-year basis. The performance highlights branded pharmaceutical sales growth from existing Pharmaceutical Distribution and Specialty Solutions customers.
Pharmaceutical profit totaled $600 million, up 23% from the year-ago quarter’s level. The upside was driven by generics program performance and a higher contribution from the brand sales mix.
Medical Segment
Revenues at this segment fell 5% to $3.7 billion as lower PPE volumes and pricing led to a decline in Products and Distribution sales.
The segment reported a profit of $20 million compared with $59 million in the year-ago quarter. This decline was primarily due to lower volume and unfavorable sales mix.
Margin Analysis
Gross profit increased 6% year over year to $1.79 billion.
As a percentage of revenues, the gross margin in the reported quarter was 3.5%, down approximately 20 basis points on a year-over-year basis.
Distribution, selling, general and administrative expenses totaled $1.18 billion, up 3.7% from that recorded in the comparable period of 2022.
Operating income came in at $572 million against the year-ago quarter’s operating loss of $97 million.
Financial Update
The company exited the reported quarter with cash and cash equivalents of $3.99 billion compared with $3.65 billion in the fiscal second quarter of 2023.
Cumulative net cash provided by operating activities totaled $1.36 billion against net cash used in operating activities of $419 million in the year-ago period.
2023 Guidance Raised
Cardinal Health raised its fiscal 2023 guidance for earnings. The company now anticipates adjusted EPS between $5.60 and $5.80, up from the previous guided range of $5.20-$5.50. The Zacks Consensus Estimate for the same is pegged at $5.45 per share.
CAH also raised its Pharmaceutical segment profit outlook from 4-6.5% growth to 10.5%-12%. However, Medical segment profit is now expected to decline approximately 50%. Earlier, the metric was expected to be flat to down 20%.
Cardinal Health, Inc. Price, Consensus and EPS Surprise
Cardinal Health exited the fiscal third quarter on a strong note with better-than-expected earnings and revenues. The company also witnessed revenue growth in its Pharmaceutical segment.
However, intense competition and customer concentration are concerning. Weakness in the Medical segment is a woe. Contraction in gross margin also remains a headwind.
Zacks Rank and Other Key Picks
Cardinal Health carries a Zacks Rank #2 (Buy) at present.
Intuitive Surgical reported first-quarter 2023 adjusted EPS of $1.23, which beat the Zacks Consensus Estimate of $1.19. Revenues of $1.7 billion outpaced the consensus mark by 6.9%.
Intuitive Surgical has a long-term estimated growth rate of 13%. ISRG’s earnings surpassed estimates in two of the trailing four quarters and missed the same twice, the average surprise being 1.86%.
Hologic reported first-quarter 2023 adjusted EPS of $1.06, which beat the Zacks Consensus Estimate by 20.5%. Revenues of $1.03 billion outpaced the consensus estimate by 6.2%.
Hologic has a long-term estimated growth rate of 15.2%. HOLX’s earnings surpassed estimates in each of the trailing four quarters, the average surprise being 27.32%.
Edwards Lifesciences reported first-quarter 2023 adjusted earnings of 62 cents per share, which beat the Zacks Consensus Estimate by 1.6%. Revenues of $1.46 billion surpassed the Zacks Consensus Estimate by 4.7%.
Edwards Lifesciences has a long-term estimated growth rate of 6.8%. EW’s earnings surpassed estimates in three of the trailing four quarters and missed the same once, the average surprise being 1.69%.
See More Zacks Research for These Tickers
Normally $25 each - click below to receive one report FREE:
Image: Bigstock
Cardinal Health (CAH) Beats on Q3 Earnings, Ups '23 EPS View
Cardinal Health, Inc. (CAH - Free Report) reported fiscal third-quarter 2023 adjusted earnings of $1.74 per share (EPS), which beat the Zacks Consensus Estimate of $1.48 by 17.6%. The bottom line also improved 20% year over year.
GAAP earnings per share in the quarter was $1.34 against the year-ago quarter’s loss of $5.05 per share. The significant gain was primarily due to growth in revenues.
Revenue Details
Sales improved 13% on a year-over-year basis to $50.5 billion. The top line also outpaced the Zacks Consensus Estimate by 1.7%.
Segmental Analysis
Pharmaceutical Segment
In the reported quarter, pharmaceutical revenues increased 14% to $46.8 billion on a year-over-year basis. The performance highlights branded pharmaceutical sales growth from existing Pharmaceutical Distribution and Specialty Solutions customers.
Pharmaceutical profit totaled $600 million, up 23% from the year-ago quarter’s level. The upside was driven by generics program performance and a higher contribution from the brand sales mix.
Medical Segment
Revenues at this segment fell 5% to $3.7 billion as lower PPE volumes and pricing led to a decline in Products and Distribution sales.
The segment reported a profit of $20 million compared with $59 million in the year-ago quarter. This decline was primarily due to lower volume and unfavorable sales mix.
Margin Analysis
Gross profit increased 6% year over year to $1.79 billion.
As a percentage of revenues, the gross margin in the reported quarter was 3.5%, down approximately 20 basis points on a year-over-year basis.
Distribution, selling, general and administrative expenses totaled $1.18 billion, up 3.7% from that recorded in the comparable period of 2022.
Operating income came in at $572 million against the year-ago quarter’s operating loss of $97 million.
Financial Update
The company exited the reported quarter with cash and cash equivalents of $3.99 billion compared with $3.65 billion in the fiscal second quarter of 2023.
Cumulative net cash provided by operating activities totaled $1.36 billion against net cash used in operating activities of $419 million in the year-ago period.
2023 Guidance Raised
Cardinal Health raised its fiscal 2023 guidance for earnings. The company now anticipates adjusted EPS between $5.60 and $5.80, up from the previous guided range of $5.20-$5.50. The Zacks Consensus Estimate for the same is pegged at $5.45 per share.
CAH also raised its Pharmaceutical segment profit outlook from 4-6.5% growth to 10.5%-12%. However, Medical segment profit is now expected to decline approximately 50%. Earlier, the metric was expected to be flat to down 20%.
Cardinal Health, Inc. Price, Consensus and EPS Surprise
Cardinal Health, Inc. price-consensus-eps-surprise-chart | Cardinal Health, Inc. Quote
Conclusion
Cardinal Health exited the fiscal third quarter on a strong note with better-than-expected earnings and revenues. The company also witnessed revenue growth in its Pharmaceutical segment.
However, intense competition and customer concentration are concerning. Weakness in the Medical segment is a woe. Contraction in gross margin also remains a headwind.
Zacks Rank and Other Key Picks
Cardinal Health carries a Zacks Rank #2 (Buy) at present.
Some other top-ranked stocks in the broader medical space that have announced their quarterly results are Intuitive Surgical (ISRG - Free Report) , Hologic (HOLX - Free Report) and Edwards Lifesciences (EW - Free Report) , each carrying a Zacks Rank #2 at present. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Intuitive Surgical reported first-quarter 2023 adjusted EPS of $1.23, which beat the Zacks Consensus Estimate of $1.19. Revenues of $1.7 billion outpaced the consensus mark by 6.9%.
Intuitive Surgical has a long-term estimated growth rate of 13%. ISRG’s earnings surpassed estimates in two of the trailing four quarters and missed the same twice, the average surprise being 1.86%.
Hologic reported first-quarter 2023 adjusted EPS of $1.06, which beat the Zacks Consensus Estimate by 20.5%. Revenues of $1.03 billion outpaced the consensus estimate by 6.2%.
Hologic has a long-term estimated growth rate of 15.2%. HOLX’s earnings surpassed estimates in each of the trailing four quarters, the average surprise being 27.32%.
Edwards Lifesciences reported first-quarter 2023 adjusted earnings of 62 cents per share, which beat the Zacks Consensus Estimate by 1.6%. Revenues of $1.46 billion surpassed the Zacks Consensus Estimate by 4.7%.
Edwards Lifesciences has a long-term estimated growth rate of 6.8%. EW’s earnings surpassed estimates in three of the trailing four quarters and missed the same once, the average surprise being 1.69%.