The Investor
11 Aug 2026, 15:32
Cardinal Health Stock Edges Higher as Strong Q4 Earnings and Bullish FY2027 Outlook Support Shares
Cardinal Health (NYSE: CAH) shares gained about 0.45% on Tuesday after the healthcare distributor reported strong fiscal fourth-quarter results, raised its earnings trajectory for fiscal 2027 and announced a substantial expansion of its share repurchase authorization.
Fourth-quarter revenue increased 6% year over year to $63.7 billion, while GAAP diluted EPS jumped 70% to $1.70. Non-GAAP EPS rose 40% to $2.91, although the figure included a $0.31 benefit from the recognition of IEEPA tariff refunds. Excluding that one-time impact, adjusted EPS still increased a solid 25% to $2.60.
For the full fiscal year, revenue climbed 14% to $254.2 billion, while non-GAAP operating earnings increased 30% to $3.6 billion. Adjusted EPS rose 37% to $11.26, or 33% excluding the tariff-refund benefit.
Pharmaceutical Business Drives Profit Growth
Cardinal Health’s Pharmaceutical and Specialty Solutions segment remained a key earnings driver. Quarterly revenue increased 6% to $58.8 billion, supported by higher brand and specialty pharmaceutical sales, while segment profit jumped 21% to $645 million.
The Global Medical Products and Distribution business presented a more mixed picture. Revenue declined 2% to $3.1 billion, but segment profit more than doubled to $150 million, largely reflecting the IEEPA tariff refunds.
The company's other businesses also remained strong, with revenue increasing 7% and segment profit rising 14%, supported by OptiFreight Logistics and at-Home Solutions.
Cardinal Health Targets Double-Digit EPS Growth in FY2027
The outlook was another positive element of the report. Cardinal Health expects fiscal 2027 non-GAAP EPS of $12.40 to $12.60, representing growth of 13% to 15% and exceeding its longer-term EPS growth framework.
Pharmaceutical and Specialty Solutions profit is expected to grow 8% to 11%, while the company's other businesses are projected to deliver 15% to 18% profit growth. Adjusted free cash flow is forecast at $3.5 billion to $4.0 billion.
Shareholder returns also remain a priority. Cardinal Health repurchased $1.4 billion of shares during fiscal 2026, and its board approved an additional $5 billion authorization, bringing total available repurchase authorization to $6.4 billion as of August.
The relatively modest 0.45% stock gain suggests much of Cardinal Health's strong operating momentum may already be reflected in its valuation. Still, double-digit profit growth across all five operating segments, strong cash generation and above-trend FY2027 EPS guidance provided fundamental support for the shares.
Cardinal Health (NYSE: CAH) shares gained about 0.45% on Tuesday after the healthcare distributor reported strong fiscal fourth-quarter results, raised its earnings trajectory for fiscal 2027 and announced a substantial expansion of its share repurchase authorization.
Fourth-quarter revenue increased 6% year over year to $63.7 billion, while GAAP diluted EPS jumped 70% to $1.70. Non-GAAP EPS rose 40% to $2.91, although the figure included a $0.31 benefit from the recognition of IEEPA tariff refunds. Excluding that one-time impact, adjusted EPS still increased a solid 25% to $2.60.
For the full fiscal year, revenue climbed 14% to $254.2 billion, while non-GAAP operating earnings increased 30% to $3.6 billion. Adjusted EPS rose 37% to $11.26, or 33% excluding the tariff-refund benefit.
Pharmaceutical Business Drives Profit Growth
Cardinal Health’s Pharmaceutical and Specialty Solutions segment remained a key earnings driver. Quarterly revenue increased 6% to $58.8 billion, supported by higher brand and specialty pharmaceutical sales, while segment profit jumped 21% to $645 million.
The Global Medical Products and Distribution business presented a more mixed picture. Revenue declined 2% to $3.1 billion, but segment profit more than doubled to $150 million, largely reflecting the IEEPA tariff refunds.
The company's other businesses also remained strong, with revenue increasing 7% and segment profit rising 14%, supported by OptiFreight Logistics and at-Home Solutions.
Cardinal Health Targets Double-Digit EPS Growth in FY2027
The outlook was another positive element of the report. Cardinal Health expects fiscal 2027 non-GAAP EPS of $12.40 to $12.60, representing growth of 13% to 15% and exceeding its longer-term EPS growth framework.
Pharmaceutical and Specialty Solutions profit is expected to grow 8% to 11%, while the company's other businesses are projected to deliver 15% to 18% profit growth. Adjusted free cash flow is forecast at $3.5 billion to $4.0 billion.
Shareholder returns also remain a priority. Cardinal Health repurchased $1.4 billion of shares during fiscal 2026, and its board approved an additional $5 billion authorization, bringing total available repurchase authorization to $6.4 billion as of August.
The relatively modest 0.45% stock gain suggests much of Cardinal Health's strong operating momentum may already be reflected in its valuation. Still, double-digit profit growth across all five operating segments, strong cash generation and above-trend FY2027 EPS guidance provided fundamental support for the shares.
