According to Zacks, “McKesson depends heavily on the pharmaceutical distribution business, which is characterized by slow growth. Unfavorable movements in foreign exchange rates continue to hurt sales. In addition McKesson expects weaker generic pharmaceutical pricing trends, specific to the company’s mix of business, in 2017. Moreover, the expiration of McKesson’s contract with Optum will be a major headwind. Operating performance of Celesio which was disappointing in the fiscal first quarter of 2017 due to reimbursement cuts, is expected to continue through the year. However, the company has been actively pursuing deals and acquisitions to drive growth. McKesson will separate its Technology business into a new healthcare information technology company, which is slated to close in the first half of calendar 2017. The spin-off will enable the company to concentrate on the primary pharmaceuticals distribution business.”
MCK has been the topic of several other research reports. Vetr raised McKesson Corp. from a buy rating to a strong-buy rating in a report on Friday, September 16th. Leerink Swann reissued an outperform rating and issued a $230.00 price objective on shares of McKesson Corp. in a research note on Thursday, September 1st. Mizuho dropped their price objective on McKesson Corp. from $197.00 to $183.00 and set a neutral rating on the stock in a research note on Monday, September 26th. Raymond James Financial Inc. downgraded McKesson Corp. from a strong-buy rating to an outperform rating in a research note on Wednesday, June 1st. Finally, Bank of America Corp. began coverage on McKesson Corp. in a report on Wednesday, June 8th. They issued a hold rating on the stock. One research analyst has rated the stock with a sell rating, eight have assigned a hold rating, ten have assigned a buy rating and one has given a strong buy rating to the stock. The company presently has a consensus rating of Buy and an average price target of $201.17.
McKesson Corp. (NYSE:MCK) opened at 165.38 on Thursday. The firm has a market cap of $37.33 billion, a price-to-earnings ratio of 17.17 and a beta of 0.93. McKesson Corp. has a one year low of $148.29 and a one year high of $202.20. The company’s 50-day moving average price is $178.53 and its 200-day moving average price is $179.25.
McKesson Corp. (NYSE:MCK) last issued its earnings results on Wednesday, July 27th. The company reported $3.50 EPS for the quarter, topping the consensus estimate of $3.33 by $0.17. The company earned $49.73 billion during the quarter, compared to analyst estimates of $50.32 billion. McKesson Corp. had a return on equity of 31.62% and a net margin of 1.15%. The business’s revenue was up 4.6% on a year-over-year basis. During the same quarter last year, the firm earned $3.14 EPS. On average, analysts anticipate that McKesson Corp. will post $13.63 EPS for the current year.
The company also recently announced a quarterly dividend, which was paid on Monday, October 3rd. Shareholders of record on Thursday, September 1st were issued a dividend of $0.28 per share. This represents a $1.12 dividend on an annualized basis and a yield of 0.68%. The ex-dividend date of this dividend was Tuesday, August 30th. McKesson Corp.’s dividend payout ratio (DPR) is presently 11.64%.
In other news, CFO James A. Beer sold 5,500 shares of the firm’s stock in a transaction dated Thursday, July 14th. The stock was sold at an average price of $199.00, for a total value of $1,094,500.00. Following the completion of the transaction, the chief financial officer now owns 12,412 shares in the company, valued at approximately $2,469,988. The sale was disclosed in a filing with the Securities & Exchange Commission, which is available through this hyperlink. Also, Director Wayne A. Budd sold 2,309 shares of the firm’s stock in a transaction dated Monday, September 12th. The shares were sold at an average price of $179.70, for a total value of $414,927.30. Following the completion of the transaction, the director now owns 723 shares of the company’s stock, valued at approximately $129,923.10. The disclosure for this sale can be found here. Company insiders own 1.15% of the company’s stock.
Institutional investors have recently made changes to their positions in the stock. Vanguard Group Inc. increased its stake in shares of McKesson Corp. by 0.4% in the second quarter. Vanguard Group Inc. now owns 13,701,966 shares of the company’s stock valued at $2,557,472,000 after buying an additional 53,238 shares during the period. Wellington Management Group LLP increased its stake in shares of McKesson Corp. by 9.3% in the first quarter. Wellington Management Group LLP now owns 11,312,022 shares of the company’s stock valued at $1,778,816,000 after buying an additional 961,630 shares during the period. State Street Corp increased its stake in shares of McKesson Corp. by 1.9% in the second quarter. State Street Corp now owns 9,280,300 shares of the company’s stock valued at $1,732,181,000 after buying an additional 169,117 shares during the period. Capital Research Global Investors increased its stake in shares of McKesson Corp. by 16.8% in the second quarter. Capital Research Global Investors now owns 9,021,412 shares of the company’s stock valued at $1,683,847,000 after buying an additional 1,297,412 shares during the period. Finally, Boston Partners increased its stake in shares of McKesson Corp. by 108.6% in the second quarter. Boston Partners now owns 4,659,692 shares of the company’s stock valued at $869,731,000 after buying an additional 2,425,685 shares during the period. Institutional investors own 84.77% of the company’s stock.
McKesson Corp. Company Profile
McKesson Corporation (McKesson) is a pharmaceutical distribution services and information technology company. The Company delivers an offering of pharmaceuticals and medical supplies. It operates through two segments: McKesson Distribution Solutions and McKesson Technology Solutions. The Distribution Solutions segment distributes branded and generic pharmaceutical drugs and other healthcare-related products around the world and provides practice management, technology, clinical support and business solutions to community-based oncology and other specialty practices.
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