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Key Takeaways CAH is integrating technology across distribution, specialty services, patient support and logistics.Sonexus now connects with Nuclear's web-ordering platform for an end-to-end digital workflow.CAH expects $700 million in fiscal 2027 capital spending, including infrastructure and technology. Cardinal Health’s (CAH - Free Report) fiscal 2026 results suggest that technology is becoming an increasingly important layer across its healthcare infrastructure, complementing its traditional distribution capabilities. The company has invested heavily in automation, technology and advanced analytics across its distribution network, with management citing meaningful gains in efficiency and service performance. These investments are translating into measurable operational benefits: Cardinal’s total fill rate reached nearly 99%, while the company recorded its best quarter for on-time departures.

The transformation is particularly visible in Sonexus, Cardinal Health’s specialty access and patient-support business. Rather than operating Sonexus as a standalone service, Cardinal Health has integrated it directly into the Nuclear business’ web-ordering platform. The result is an end-to-end digital workflow for high-cost radiopharmaceuticals, combining insurance-benefit verification, patient enrollment and order placement within a single system. This integration potentially reduces friction across a highly complex healthcare transaction while improving the experience for providers and patients.

Technology is also reshaping Cardinal Health’s logistics offering. OptiFreight is expanding its technology-enabled products, including Shipment Navigator and Tracking Beacon, which are designed to provide customers with greater visibility and insights into outbound pharmacy shipments. Management said adoption has been strong, as these solutions are built to generate cost savings and efficiency for healthcare providers.

The broader strategy is therefore moving beyond simply distributing pharmaceuticals and medical products. Cardinal Health is increasingly connecting distribution, specialty services, patient support and logistics through digital workflows. Its Consumer Health Logistics Center, meanwhile, has used technology and automation to improve service levels and customer access.

The financial opportunity lies in making these investments scalable. Cardinal expects $700 million of fiscal 2027 capital expenditures, including infrastructure and technology investments supporting future growth. If technology continues improving throughput, accuracy, customer experience and supply-chain visibility, Cardinal Health could increasingly operate as a tech-enabled healthcare platform rather than a conventional distributor.

Peer UpdatesCONMED (CNMD - Free Report) is building its technology proposition around AirSeal, using differentiated surgical technology and clinical evidence to improve procedure efficiency and outcomes. AirSeal’s low-pressure insufflation platform is designed to improve visualization, reduce procedure times, postoperative pain and length of stay, making it increasingly relevant as robotic surgery expands across specialties and ASCs. CONMED is also generating ASC-specific economic data and expanding clinical relationships in laparoscopic applications such as colorectal and gynecology. With AirSeal currently used in only 6-7% of more than 3 million U.S. laparoscopic procedures, the company has substantial room to expand utilization. Management expects long-term AirSeal growth of high-single-digit to low-double-digit rates.

Align Technology (ALGN - Free Report) is developing a broader digital healthcare platform that connects imaging, diagnostics, treatment planning and treatment delivery. Its Align Digital Platform integrates iTero scanners, Invisalign, exocad and X-ray Insight software, creating a connected workflow spanning orthodontic and restorative dentistry. New platform capabilities are designed to improve patient engagement, treatment planning and workflow efficiency, while software, visualization, digital planning and 3D printing help doctors increase practice productivity. The strategy is also expanding the installed scanner base through lower-cost configurations, leasing and rental models, which can increase digital adoption and create a larger funnel for higher-margin, recurring treatment revenue. With active scanner units up 11% year over year and scans rising 16%, growing platform utilization could reinforce Align’s long-term competitive moat.

CAH’s Price Performance, Valuation and EstimatesShares of CAH have gained 17.5% so far this year compared with the industry’s 7.3% growth.

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From a valuation standpoint, Cardinal Health trades at a forward price-to-earnings of 19.2X, above the industry average. However, it is trading lower than its five-year high of 22.19X. CAH carries a Value Score of A.

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The Zacks Consensus Estimate for Cardinal Health’s fiscal 2027 earnings implies an 11.5% rise from the year-ago reported number.

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The company currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Key Takeaways Cardinal Health expects Pharma segment profit to grow 8-11%, supported by specialty and generic launches.Cell-and-gene therapy capabilities and non-core businesses are expanding CAH's growth opportunities.IRA pricing changes, GMPD execution challenges and $700 million in CapEx could pressure performance. Cardinal Health (CAH - Free Report) enters fiscal 2027 with strong momentum across pharmaceutical distribution, specialty solutions and growth businesses. Specialty pharmaceuticals, cell-and-gene therapy capabilities and expanding non-core operations should support earnings growth, while IRA-related pricing changes, GMPD execution challenges, tariffs and elevated operating costs could constrain its overall performance.

Shares of this Zacks Rank #3 (Hold) company have risen 11.7% so far this year compared with the industry's 5.2% growth and the S&P 500 Index’s 11.7% gain.

Cardinal Health, with a market capitalization of $53.38 billion, is a global specialty medical device company.

CAH’s bottom line is estimated to improve 14.9% over the next five years. Its earnings beat estimates in each of the trailing four quarters, delivering an average surprise of 14.72%.

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What's Driving CAH’s Performance?Pharma and Specialty Solutions Driving Robust Earnings Growth: Cardinal Health enters fiscal 2027 with strong momentum in its largest business, Pharmaceutical and Specialty Solutions. Revenues increased 6% to $58.8 billion in the fourth quarter of fiscal 2026, while segment profit rose 21% to $645 million, driven by brand and specialty portfolios and continued strength in generics.

Management expects Pharma revenues to grow 3-5% in fiscal 2027, with segment profit increasing 8-11%, supported by higher-margin Specialty growth, generic launches and distribution wins. Specialty revenues are expected to grow double digits, including new BioPharma Solutions customers, providing a favorable mix shift toward higher-margin businesses and reducing reliance on traditional pharmaceutical distribution.

Specialty and Cell-and-Gene Therapy Expand Addressable Market: Cardinal Health continues to build higher-value capabilities around specialty pharmaceuticals, particularly complex cell and gene therapies. Its 3PL business secured two additional gene-therapy commercialization agreements, bringing Cardinal Health's exclusive coverage to nearly half of the cell-and-gene market and approximately three-quarters of the total market. The newly opened Innovative Care Pharmacy further integrates specialty distribution, clinical support and financial solutions for high-cost therapies.

These investments should allow Cardinal to capture more economics across the pharmaceutical value chain as specialty drug utilization expands. The opportunity is particularly attractive because specialized services typically generate higher margins than traditional drug distribution.

Other Growth Businesses Provide Diversification: Cardinal's non-core growth businesses are increasingly becoming meaningful contributors to consolidated earnings. The group generated $1.7 billion in revenues during the fiscal fourth quarter, up 7%, while segment profit increased 14% to $183 million.

Management expects revenue growth of 11-13% and segment profit growth of 15-18% in fiscal 2027. Nuclear and Precision Health Solutions should benefit from strong Theranostics and PET demand, while OptiFreight continues to generate strong core volume growth. At-Home Solutions also has additional scale opportunities through Strive Medical and the planned AdaptHealth diabetes acquisition. This diversification should support faster profit growth than the core distribution business.

What’s Hurting CAH’s ProspectIRA Pricing Changes Will Continue to Constrain Growth: Cardina Health's Pharma business faces a recurring revenue headwind from changes associated with the Inflation Reduction Act (IRA). Management expects fiscal 2027 Pharma revenue growth of only 3-5%, partly because of the annualization of 2026 IRA price changes and implementation of 2027 changes. The company estimates that the 2027 impact on revenue growth will be generally consistent with the headwind experienced during the second half of fiscal 2026. Although management expects no adverse profit impact, lower reported revenue growth could limit the pace of top-line expansion. Uncertainty over whether these changes will ultimately be reflected in rebates or a lower WACC also complicates forecasting.

GMPD Remains a Low-Growth Business: Global Medical Products and Distribution continues to represent a structural challenge despite meaningful improvement. Cardinal Health expects GMPD revenues to increase only 2-4% in fiscal 2027, while segment profit is projected to be $200-$220 million, approximately $50 million above the fiscal 2026 figure, excluding the IEEPA refund.

The improvement depends on continued simplification, Cardinal Health brand growth and cost optimization. Management expects fiscal first-quarter GMPD profit to be roughly half of the prior-year level because of foreign currency and distributor purchase timing, with profit weighted toward the second half. This cadence creates execution risk and limits near-term earnings visibility.

Heavy CapEx Could Pressure Near-Term Cash Conversion: Cardinal Health's transformation increasingly depends on continued capital expenditure to support investment in infrastructure, automation, technology and acquisitions. The company expects $700 million in capital expenditures and $3.5-$4 billion in adjusted free cash flow in fiscal 2027, down from $5 billion in fiscal 2026. Recent acquisitions in At-Home Solutions, including Strive Medical and the planned AdaptHealth diabetes business, introduce integration and execution requirements even as management pursues additional tuck-in opportunities.

Although these investments are intended to generate future scale and synergies, they can constrain near-term cash conversion and increase complexity. The company must therefore balance investment in growth with its commitment to at least $1 billion in annual share repurchases.

Estimate TrendThe Zacks Consensus Estimate for fiscal 2027 revenues is pegged at $267.75 billion, implying growth of 5.3% from the year-ago reported figure. The consensus mark for adjusted EPS is pinned at $12.49, indicating an improvement of 10.9% from the previous year’s recorded level.

In the past 60 days, CAH’s earnings estimate for fiscal 2027 has improved 4%.

Stocks to ConsiderSome better-ranked stocks from the broader medical space are Globus Medical (GMED - Free Report) , Veracyte (VCYT - Free Report) andWest Pharmaceutical (WST - Free Report) .

Globus Medical, currently sporting a Zacks Rank #1 (Strong Buy), reported a second-quarter 2026 adjusted earnings per share (EPS) of $1.34, which surpassed the Zacks Consensus Estimate by 19.6%. Revenues of $789.6 million beat the Zacks Consensus Estimate by 0.4%. You can see the complete list of today’s Zacks #1 Rank stocks here.

GMED has an estimated long-term earnings growth rate of 12.4%. The company’s earnings beat estimates in each of the trailing four quarters, the average surprise being 27.9%.

Veracyte, currently flaunting a Zacks Rank #1, reported a second-quarter 2026 adjusted EPS of 54 cents, which surpassed the Zacks Consensus Estimate by 25.6%. Revenues of $150.3 million beat the Zacks Consensus Estimate by 4.1%.

VCYT has an estimated earnings growth rate of 8.4% for 2026. The company’s earnings beat estimates in each of the trailing four quarters, the average surprise being 41.8%.

West Pharmaceutical, carrying a Zacks Rank #2 (Buy) at present, reported second-quarter 2026 adjusted EPS of $2.37, which beat the Zacks Consensus Estimate by 13.9%. Revenues of $872.3 million surpassed the Zacks Consensus Estimate by 4.2%.

WST has an estimated long-term earnings growth rate of 16%. WST’s earnings surpassed estimates in the trailing four quarters, the average surprise being 17.4%.

B. Metzler seel. Sohn & Co. AG acquired a new stake in Cardinal Health, Inc. (NYSE:CAH – Free Report) in the second quarter, according to the company in its most recent Form 13F filing with the Securities & Exchange Commission. The firm acquired 26,592 shares of the company’s stock, valued at approximately $6,317,000.

Several other large investors have also added to or reduced their stakes in CAH. Kornitzer Capital Management Inc. KS increased its holdings in shares of Cardinal Health by 100.8% in the 4th quarter. Kornitzer Capital Management Inc. KS now owns 18,164 shares of the company’s stock worth $3,733,000 after buying an additional 9,120 shares during the last quarter. Abacus FCF Advisors LLC purchased a new position in shares of Cardinal Health in the 4th quarter worth about $7,182,000. Byrne Financial Freedom LLC bought a new position in shares of Cardinal Health during the 4th quarter valued at about $1,574,000. Belleair Asset Management LLC purchased a new position in shares of Cardinal Health in the fourth quarter worth about $1,100,000. Finally, Axecap Investments LLC bought a new position in shares of Cardinal Health in the fourth quarter worth approximately $2,371,000. Institutional investors own 87.17% of the company’s stock.

Analyst Ratings Changes CAH has been the subject of a number of recent analyst reports. Wells Fargo & Company upped their target price on Cardinal Health from $245.00 to $277.00 and gave the company an “overweight” rating in a report on Wednesday, August 12th. William Blair began coverage on Cardinal Health in a report on Tuesday, April 28th. They issued an “outperform” rating on the stock. Evercore restated an “outperform” rating and set a $270.00 price objective on shares of Cardinal Health in a research note on Wednesday, August 12th. Bank of America lifted their target price on shares of Cardinal Health from $240.00 to $260.00 and gave the stock a “buy” rating in a report on Thursday, July 2nd. Finally, Royal Bank Of Canada assumed coverage on shares of Cardinal Health in a research report on Wednesday. They set an “outperform” rating and a $276.00 price target for the company. Sixteen equities research analysts have rated the stock with a Buy rating and three have assigned a Hold rating to the company’s stock. Based on data from MarketBeat.com, Cardinal Health has a consensus rating of “Moderate Buy” and an average target price of $266.56.

Check Out Our Latest Research Report on Cardinal Health Insider Buying and Selling at Cardinal Health In other news, CEO Jason M. Hollar sold 44,529 shares of the company’s stock in a transaction that occurred on Wednesday, August 19th. The shares were sold at an average price of $236.18, for a total value of $10,516,859.22. Following the completion of the sale, the chief executive officer directly owned 190,603 shares of the company’s stock, valued at approximately $45,016,616.54. This represents a 18.94% decrease in their position. The sale was disclosed in a legal filing with the SEC, which is accessible through this link. Also, CEO Deborah Weitzman sold 7,354 shares of the firm’s stock in a transaction that occurred on Tuesday, August 18th. The shares were sold at an average price of $235.45, for a total transaction of $1,731,499.30. Following the completion of the transaction, the chief executive officer directly owned 77,901 shares in the company, valued at approximately $18,341,790.45. The trade was a 8.63% decrease in their ownership of the stock. The SEC filing for this sale provides additional information. In the last 90 days, insiders sold 210,271 shares of company stock worth $49,626,657. 0.12% of the stock is owned by insiders.

Cardinal Health Trading Up 0.4% Shares of Cardinal Health stock opened at $229.48 on Friday. The firm has a market cap of $53.37 billion, a PE ratio of 31.74, a PEG ratio of 1.22 and a beta of 0.49. Cardinal Health, Inc. has a 12 month low of $145.87 and a 12 month high of $258.30. The stock has a 50 day moving average of $232.02 and a 200 day moving average of $217.86.

Cardinal Health (NYSE:CAH – Get Free Report) last announced its quarterly earnings results on Tuesday, August 11th. The company reported $2.91 EPS for the quarter, beating analysts’ consensus estimates of $2.42 by $0.49. Cardinal Health had a net margin of 0.67% and a negative return on equity of 98.53%. The business had revenue of $63.67 billion for the quarter, compared to analyst estimates of $65.15 billion. During the same quarter in the prior year, the business earned $2.08 EPS. Cardinal Health’s quarterly revenue was up 5.8% on a year-over-year basis. Cardinal Health has set its FY 2027 guidance at 12.400-12.600 EPS. As a group, equities research analysts forecast that Cardinal Health, Inc. will post 12.54 earnings per share for the current fiscal year.

Cardinal Health Dividend Announcement The firm also recently announced a quarterly dividend, which will be paid on Thursday, October 15th. Stockholders of record on Thursday, October 1st will be paid a dividend of $0.5158 per share. The ex-dividend date is Thursday, October 1st. This represents a $2.06 annualized dividend and a dividend yield of 0.9%. Cardinal Health’s dividend payout ratio (DPR) is currently 28.49%.

Key Headlines Impacting Cardinal Health Here are the key news stories impacting Cardinal Health this week:

Positive Sentiment: Royal Bank of Canada initiated coverage with an “outperform” rating and a $276 price target, implying meaningful upside from recent trading levels. RBC cited Cardinal Health’s higher-margin services as a potential earnings-growth driver. RBC initiates coverage of Cardinal Health Positive Sentiment: Wall Street remains broadly constructive, with 16 analysts rating CAH a Buy and three assigning a Hold rating. The consensus rating is “Moderate Buy,” with an average price target of approximately $266.56. Zacks also identified Cardinal Health as a potentially attractive long-term value stock. Zacks value-stock analysis Positive Sentiment: Cardinal Health’s latest quarter delivered adjusted earnings per share of $2.91, well above the $2.42 consensus estimate, while revenue increased 5.8% year over year. Fiscal 2027 EPS guidance of $12.40–$12.60 supports the longer-term earnings case. Neutral Sentiment: The company declared a quarterly dividend of $0.5158 per share, equivalent to $2.06 annually and a yield of about 0.9%. The payout offers modest income support but is unlikely to be a major near-term catalyst. Negative Sentiment: Several executives sold sizable holdings around $235–$237 per share. CEO Jason Hollar sold 124,529 shares worth about $29.4 million, while other executive and insider sales—including those by Deborah Weitzman, Stephen Mason, Michelle Greene, Jessica Mayer and Mary Scherer—totaled roughly $20 million more. The concentrated selling and substantial reductions in insider ownership may encourage profit-taking concerns after CAH’s strong advance. Cardinal Health insider sales Negative Sentiment: Investors may also question the durability of the latest earnings beat because part of the improvement reportedly reflected a one-time tariff refund, potentially limiting the stock’s upside if recurring earnings growth does not match expectations. Cardinal Health earnings analysis Cardinal Health Company Profile (Free Report)

Cardinal Health is a multinational healthcare services and products company headquartered in Dublin, Ohio. Tracing its roots to the early 1970s, the company has grown into a major provider of supply chain and distribution services for the healthcare sector. Cardinal Health operates across a range of service lines that support hospitals, health systems, pharmacies, physician offices and clinical laboratories.

The company’s core activities include the wholesale distribution of branded and generic pharmaceuticals, the supply and distribution of medical-surgical products, and the provision of logistics and inventory management solutions.

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Cardinal Health, Inc. (CAH) Q4 2026 Earnings Call August 11, 2026 8:30 AM EDT

Company Participants

David Frost - Vice President of Finance, Global Operations & Supply Chain
Jason Hollar - CEO & Director
Aaron Alt - Chief Financial Officer

Conference Call Participants

Erin Wilson Wright - Morgan Stanley, Research Division
Elizabeth Anderson - Evercore ISI Institutional Equities, Research Division
Lisa Gill - JPMorgan Chase & Co, Research Division
Eric Percher - Nephron Research LLC
Allen Lutz - BofA Securities, Research Division
George Hill - Deutsche Bank AG, Research Division
Stephen Baxter - Wells Fargo Securities, LLC, Research Division
Kevin Caliendo - UBS Investment Bank, Research Division
Lucas Romanski - TD Cowen, Research Division
Eric Coldwell - Robert W. Baird & Co. Incorporated, Research Division

Presentation

Operator

Hello, everyone. Thank you for joining us, and welcome to Cardinal Health, Inc. Fourth Quarter Fiscal Year 2026 Earnings Release. [Operator Instructions]

I will now hand the conference over to David Frost, Vice President of Investor Relations. Please go ahead.

David Frost
Vice President of Finance, Global Operations & Supply Chain

Good morning. Welcome to Cardinal Health's Fourth Quarter Fiscal 2026 Earnings Conference Call, and thank you for joining us. With me today are Cardinal Health's CEO, Jason Hollar; and our CFO, Aaron Alt. You can find this morning's earnings press release and investor presentation on the Investor Relations section of our website at ir.cardinalhealth.com.

Since we will be making forward-looking statements today, let me remind you that the matters addressed in these statements are subject to risks and uncertainties that could cause our actual results to differ materially from those projected or implied. Please refer to our SEC filings and the forward-looking statement slide at the beginning of our presentation for a description of these risks and uncertainties.

Please note that during our discussion today, the comments will be on a non-GAAP

Fourth quarter revenue increased 6% to $63.7 billion Fourth quarter GAAP1 diluted EPS increased 70% to $1.70 Excluding a one-time positive impact of $0.31 from the recognition of the IEEPA tariff refund, fourth quarter non-GAAP diluted EPS increased 25% to $2.60, with reported fourth quarter non-GAAP diluted EPS increasing 40% to $2.91 For fiscal year 2026, excluding the IEEPA tariff refund recognition, non-GAAP diluted EPS increased 33% to $10.95, with reported non-GAAP diluted EPS increasing 37% to $11.26 Fiscal year 2026 operating cash flow $5.2 billion and adjusted free cash flow $5.0 billion Incremental $350 million share repurchase completed, bringing fiscal year 2026 repurchase total to $1.4 billion, with $5.0 billion incremental repurchase authorization approved by board of directors Cardinal Health provides fiscal year 2027 non-GAAP EPS guidance2 of 13% to 15% growth3 ($12.40 to $12.60), above the Company's long-term EPS guidance , /PRNewswire/ -- Cardinal Health (NYSE: CAH) today reported fourth quarter fiscal year 2026 revenues of $63.7 billion, an increase of 6% from the fourth quarter of fiscal year 2025. Fourth quarter GAAP operating earnings increased 70% to $729 million and GAAP diluted earnings per share (EPS) increased 70% to $1.70.

Fourth quarter non-GAAP operating earnings increased 30% to $935 million. Non-GAAP diluted EPS increased 40% to $2.91, reflecting the increase in non-GAAP earnings, including the recognition of a one-time net operating profit impact of IEEPA tariff refunds of $100 million in the GMPD segment, a lower non-GAAP effective tax rate, and a lower share count, partially offset by an increase in interest and other expense.

Fiscal year 2026 revenues were $254.2 billion, a 14% increase from fiscal year 2025. GAAP operating earnings were $2.6 billion and GAAP diluted EPS was $7.23. Non-GAAP operating earnings increased 30% to $3.6 billion, driven by segment profit increases across all five operating segments. Non-GAAP diluted EPS increased 37% to $11.26 for the year, reflecting the increase in non-GAAP operating earnings across the business, including the recognition of a one-time net operating profit impact of IEEPA tariff refunds of $100 million in the GMPD segment, a lower non-GAAP effective tax rate, and a lower share count following in-year share repurchases, partially offset by an increase in interest and other expense.

"Fiscal 2026 was a standout year for Cardinal Health and I am pleased with our strong fourth quarter results," said Jason Hollar, CEO of Cardinal Health. "The broad-based operational strength for the year, with all five of our operating segments growing profit double-digits, even before recognition of IEEPA tariff recoveries in GMPD, reflects the disciplined execution of our strategy and our investments for growth. We enter Fiscal 2027 with momentum and confidence in our ability to deliver continued shareholder value creation."

Q4 and full year FY26 summary

Q4 FY26

Q4 FY25

Y/Y

FY26

FY25

Y/Y

Revenue

$63.7 billion

$60.2 billion

6 %

$254.2 billion

$222.6 billion

14 %

Operating earnings

$729 million

$428 million

70 %

$2.6 billion

$2.3 billion

15 %

Non-GAAP operating earnings

$935 million

$719 million

30 %

$3.6 billion

$2.8 billion

30 %

Net earnings attributable to Cardinal Health, Inc.

$398 million

$239 million

67 %

$1.7 billion

$1.6 billion

10 %

Non-GAAP net earnings attributable to Cardinal Health, Inc.

$682 million

$501 million

36 %

$2.7 billion

$2.0 billion

34 %

Effective Tax Rate

27.9 %

36.9 %

21.6 %

25.3 %

Non-GAAP Effective Tax Rate

22.5 %

26.3 %

19.0 %

23.3 %

Diluted EPS attributable to Cardinal Health, Inc.

$1.70

$1.00

70 %

$7.23

$6.45

12 %

Non-GAAP diluted EPS attributable to Cardinal Health, Inc.

$2.91

$2.08

40 %

$11.26

$8.24

37 %

Segment results

Pharmaceutical and Specialty Solutions segment

Q4 FY26

Q4 FY25

Y/Y

FY26

FY25

Y/Y

Revenue

$58.8 billion

$55.4 billion

6 %

$234.8 billion

$204.6 billion

15 %

Segment profit

$645 million

$535 million

21 %

$2.8 billion

$2.3 billion

23 %

Fourth quarter revenue for the Pharmaceutical and Specialty Solutions segment increased 6% to $58.8 billion, driven by brand and specialty pharmaceutical sales growth from existing customers.

Pharmaceutical and Specialty Solutions segment profit increased 21% to $645 million in the fourth quarter, primarily driven by contributions from brand and specialty products and positive generics program performance.

Global Medical Products and Distribution segment

Q4 FY26

Q4 FY25

Y/Y

FY26

FY25

Y/Y

Revenue

$3.1 billion

$3.2 billion

(2) %

$12.7 billion

$12.6 billion

1 %

Segment profit

$150 million

$70 million

N.M.

$258 million

$135 million

91 %

Fourth quarter revenue for the Global Medical Products and Distribution segment decreased 2% from the prior year to $3.1 billion. This decrease was primarily driven by lower distribution volumes and the recognition of the expected IEEPA tariff refund repayment to customers, partially offset by Cardinal Health brand growth.

Global Medical Products and Distribution segment profit increased to $150 million in the fourth quarter, primarily driven by IEEPA tariff refunds.

Other4

Q4 FY26

Q4 FY25

Y/Y

FY26

FY25

Y/Y

Revenue

$1.7 billion

$1.6 billion

7 %

$6.8 billion

$5.4 billion

26 %

Segment profit

$183 million

$160 million

14 %

$707 million

$516 million

37 %

Fourth quarter revenue for Other increased 7% to $1.7 billion, driven by growth across the three operating segments: Nuclear and Precision Health Solutions, OptiFreight Logistics, and at-Home Solutions.

Other segment profit increased 14% to $183 million in the fourth quarter, driven by growth in OptiFreight Logistics and at-Home Solutions.

Fiscal year 2027 outlook2

The company released its fiscal year 2027 outlook for non-GAAP diluted EPS of +13% to +15% growth3 ($12.40 to $12.60).

Non-GAAP earnings per share

$12.40 to $12.60

Pharmaceutical and Specialty Solutions segment:

Revenue

3% to 5% growth

Segment profit

8% to 11% growth

Global Medical Products and Distribution segment:

  Revenue

2% to 4% growth

Segment profit

$200 million to $220 million

Other (NPHS, at-Home Solutions, OptiFreight Logistics):

  Revenue

11% to 13% growth

Segment profit

15% to 18% growth

Interest and other

$240 million to $290 million

Non-GAAP effective tax rate

19.0% to 20.0%

Diluted weighted average shares outstanding

~233 million

Share repurchases

~$1 billion

Capital Expenditures

~$700 million

Non-GAAP adjusted free cash flow

$3.5 billion to $4.0 billion

Financial guidance for fiscal year 2027 reflects the estimated impact of the Company's recently completed tuck-in acquisition of Strive Medical and the announced tuck-in acquisition of the Diabetes Health business of AdaptHealth.

Recent highlights

Cardinal Health recently completed an additional $350 million accelerated share repurchase program, bringing year-to-date share repurchases in fiscal year 2026 to $1.4 billion. Cardinal Health Board of Directors approved a $5.0 billion increase to the share repurchase program, bringing the total share repurchase authorization to $6.4 billion as of August 2026 Cardinal Health announces simplification of credit facilities with new $4.0 billion revolving credit facility replacing three historic facilities Cardinal Health announces long-term renewal of wholesaler distribution contract with Kroger New distribution center in Indianapolis set to open in 2027 featuring advanced robotics and automation, adding capacity and enabling operational flexibility Cardinal Health Board of Directors declared a regular quarterly dividend of $0.5158 per share, payable on October 15, 2026, to shareholders of record on October 1, 2026 Webcast

Cardinal Health will host a webcast today at 8:30 a.m. ET to discuss fourth quarter and full year results. To access the webcast and corresponding slide presentation, go to the Investor Relations page at ir.cardinalhealth.com. No access code is required. 

Presentation slides and a webcast replay will be available on the Investor Relations page for 12 months.

About Cardinal Health

Cardinal Health is a distributor of pharmaceuticals and specialty products; a global manufacturer and distributor of medical and laboratory products; a supplier of home-health and direct-to-patient products and services; an operator of nuclear pharmacies and manufacturing facilities; and a provider of performance and data solutions. Our company's customer-centric focus drives continuous improvement and leads to innovative solutions that improve people's lives every day. Learn more about Cardinal Health at cardinalhealth.com and in our Newsroom.

Contacts

Media: Erich Timmerman, [email protected] and 614.757.8231
Investors: David Frost, [email protected] and 614.757.7852

1GAAP refers to U.S. generally accepted accounting principles. This news release includes GAAP financial measures as well as non-GAAP financial measures, which are financial measures not calculated in accordance with GAAP. See "Use of Non-GAAP Measures" following the attached schedules for definitions of the non-GAAP financial measures presented in this news release and see the attached schedules for reconciliations of the differences between the non-GAAP financial measures and their most directly comparable GAAP financial measures.

2The company does not provide forward-looking guidance on a GAAP basis as certain financial information, the probable significance of which cannot be determined, is not available and cannot be reasonably estimated. See "Use of Non-GAAP Measures" following the attached schedules for additional explanation. 

3Growth rates for fiscal year 2027 guidance based upon adjusted fiscal year 2026 results which exclude the fiscal year 2026 benefit from IEEPA tariff refund.

4Other includes the following three operating segments: Nuclear and Precision Health Solutions (NPHS), at-Home Solutions and OptiFreight Logistics, which are not significant enough individually to require reportable segment disclosure.

Cardinal Health uses its website as a channel of distribution for material company information. Important information, including news releases, financial information, earnings and analyst presentations, and information about upcoming presentations and events is routinely posted and accessible on the Investor Relations page at ir.cardinalhealth.com. In addition, the website allows investors and other interested persons to sign up automatically to receive email alerts when the company posts news releases, SEC filings and certain other information on its website.

Cautions Concerning Forward-Looking Statements

This release contains forward-looking statements addressing expectations, prospects, estimates and other matters that are dependent upon future events or developments. These statements may be identified by words such as "expect," "anticipate," "intend," "plan," "believe," "will," "should," "could," "would," "project," "continue," "likely," and similar expressions, and include statements reflecting future results or guidance, statements of outlook and various accruals and estimates. These matters are subject to risks and uncertainties that could cause actual results to differ materially from those projected, anticipated or implied. These risks and uncertainties include our ability to manage uncertainties associated with the pricing of branded pharmaceuticals including those arising from proposed or final regulatory changes,  the risk that we may fail to achieve our strategic objectives, including the ongoing integration and operation of recently acquired entities and the continued execution of the GMPD Improvement Plan initiatives and ; risks and uncertainties related to tariffs, including the risk that we may not be able to offset increased costs; competitive pressures in Cardinal Health's various lines of business, including the risk that customers may reduce purchases made under their contracts with us or terminate or not renew their contracts, whether due to price increases or otherwise; risks associated with litigation matters, including Department of Justice investigations focused on potential violations of the Anti-Kickback Statute and False Claims Act; the risk that events outside of our control, such as weather or geopolitical events, including the recent conflict with Iran, may impact costs for our products or may cause supply delays or shortages or manufacturing delays that impact our cost and ability to fulfill customer demand; and the performance of our generics program, including the amount or rate of generic deflation and our ability to offset generic deflation and maintain other financial and strategic benefits through our generic sourcing venture or other components of our generics programs. Cardinal Health is subject to additional risks and uncertainties described in Cardinal Health's Form 10-K, Form 10-Q and Form 8K reports and exhibits to those reports. This release reflects management's views as of August 11, 2026. Except to the extent required by applicable law, Cardinal Health undertakes no obligation to update or revise any forward-looking statement. Forward-looking statements are aspirational and not guarantees or promises that goals, targets or projections will be met, and no assurance can be given that any commitment, expectation, initiative or plan in this report can or will be achieved or completed. Cardinal Health provides definitions and reconciliations of non-GAAP financial measures and their most directly comparable GAAP financial measures at ir.cardinalhealth.com.

Schedule 1

Cardinal Health, Inc. and Subsidiaries

Consolidated Statements of Earnings (Unaudited)

Fourth  Quarter

Fiscal Year

(in millions, except per common share amounts)

2026

2025

% Change

2026

2025

% Change

Revenue

$     63,672

$     60,159

6 %

$    254,248

$    222,578

14 %

Cost of products sold

61,112

57,957

5 %

244,474

214,410

14 %

Gross margin

2,560

2,202

16 %

9,774

8,168

20 %

Operating expenses:

Distribution, selling, general and administrative expenses

1,625

1,484

10 %

6,132

5,382

14 %

Restructuring and employee severance

40

27

106

88

Amortization and other acquisition-related costs

121

133

469

464

Acquisition-related cash and share-based compensation costs

44

106

287

126

Impairments and (gain)/loss on disposal of assets, net 1

4

33

177

18

Litigation (recoveries)/charges, net

(3)

(9)

(10)

(185)

Operating earnings

729

428

70 %

2,613

2,275

15 %

Other (income)/expense, net

(26)

(30)

(31)

(41)

Interest expense, net

79

74

7 %

348

215

62 %

Impairment of equity interest in Outcomes

122

—

122

—

Earnings before income taxes

554

384

44 %

2,174

2,101

3 %

Provision for income taxes 2

154

141

9 %

469

532

(12) %

Net earnings

400

243

65 %

1,705

1,569

9 %

Less: Net (earnings)/loss attributable to noncontrolling interests

(2)

(4)

9

(8)

Net earnings attributable to Cardinal Health, Inc.

$       398

$        239

67 %

$      1,714

$      1,561

10 %

Earnings per common share attributable to Cardinal Health, Inc.:

Basic

$      1.70

$       1.01

68 %

$        7.27

$        6.48

12 %

Diluted

1.70

1.00

70 %

7.23

6.45

12 %

Weighted-average number of common shares outstanding:

Basic

234

239

236

241

Diluted

235

240

237

242

1 Impairments and (gain)/loss on disposals of assets, net includes pre-tax goodwill impairment charges of $184 million related to the Navista & ION reporting unit within the Pharma segment recorded in fiscal year ended 2026.

2 Provision for income taxes includes the tax effects relating to the cumulative goodwill impairment charges. For fiscal 2026, the net tax benefits related to the goodwill impairment charges was $23 million.

Schedule 2

Cardinal Health, Inc. and Subsidiaries

Condensed Consolidated Balance Sheets (Unaudited)

(in millions)

June 30, 2026

June 30, 2025

Assets

Current assets:

Cash and equivalents

$         4,856

$         3,874

Trade receivables, net

13,815

13,242

Inventories, net

17,297

16,831

Prepaid expenses and other

2,764

2,414

Assets held for sale

21

12

Total current assets

38,753

36,373

Property and equipment, net

3,031

2,858

Goodwill and other intangibles, net

13,631

12,177

Other assets

1,884

1,714

Total assets

$        57,299

$        53,122

Liabilities and Shareholders' Deficit

Current liabilities:

Accounts payable

$        38,283

$        34,713

Current portion of long-term obligations and other short-term borrowings

1,882

550

Other accrued liabilities

3,739

3,634

Total current liabilities

43,904

38,897

Long-term obligations, less current portion

7,004

7,977

Deferred income taxes and other liabilities

9,115

8,882

Total shareholders' deficit

(2,724)

(2,634)

Total liabilities and shareholders' deficit

$        57,299

$        53,122

Schedule 3

Cardinal Health, Inc. and Subsidiaries

Consolidated Statements of Cash Flows (Unaudited)

Fourth  Quarter

Fiscal Year

(in millions)

2026

2025

2026

2025

Cash flows from operating activities:

Net earnings

$          400

$          243

$        1,705

1,569

Adjustments to reconcile net earnings to net cash provided by operating activities:

Depreciation and amortization

241

209

956

790

Impairments and (gain)/loss on sale of other investments, net

1

1

21

3

Impairment of equity interest in Outcomes

122

—

122

—

Impairments and (gain)/loss on disposal of assets, net

4

33

177

18

Share-based compensation

58

153

367

244

Provision for/(benefit from) deferred income taxes

91

243

91

243

Provision for bad debts

27

12

74

53

Change in operating assets and liabilities, net of effects from acquisitions and divestitures:

Increase in trade receivables

(193)

(466)

(408)

(833)

(Increase)/decrease in inventories

697

(607)

(488)

(1,816)

Increase in accounts payable

450

1,778

3,463

2,732

Repurchases of liability-classified Specialty Alliance Units

(18)

(19)

(45)

(19)

Other accrued liabilities and operating items, net

(188)

(60)

(861)

(587)

Net cash provided by operating activities

1,692

1,520

5,174

2,397

Cash flows from investing activities:

Acquisition of subsidiaries, net of cash acquired

(24)

(1,395)

(1,991)

(5,250)

Additions to property and equipment

(264)

(232)

(649)

(547)

Proceeds from disposal of property and equipment

—

—

31

3

Proceeds from investments

14

8

41

15

Proceeds from net investment hedge terminations

(6)

—

(13)

2

Proceeds from short-term investment in time deposit

—

—

—

200

Other investing items, net

(1)

(12)

(3)

(16)

Net cash used in investing activities

(281)

(1,631)

(2,584)

(5,593)

Cash flows from financing activities:

Proceeds from long-term obligations, net of issuance costs

(1)

800

990

3,669

Reduction of long-term obligations

(16)

(11)

(653)

(445)

Payments to noncontrolling interests, net

(3)

(5)

(11)

(12)

Net tax proceeds from share-based compensation

—

(1)

(79)

(13)

Dividends on common shares

(120)

(120)

(491)

(494)

Purchase of treasury shares

(350)

—

(1,358)

(765)

Net cash provided by/(used in) financing activities

(490)

663

(1,602)

1,940

Effect of exchange rates changes on cash and equivalents

(2)

(4)

(6)

(3)

Net increase/(decrease) in cash and equivalents

919

548

982

(1,259)

Cash and equivalents at beginning of period

3,937

3,326

3,874

5,133

Cash and equivalents at end of period

$        4,856

$        3,874

$        4,856

$        3,874

Schedule 4

Cardinal Health, Inc. and Subsidiaries

Segment Information (Unaudited)

Fourth Quarter

Pharmaceutical and Specialty Solutions

Global Medical Products and Distribution

Other

(in millions)

2026

2025

2026

2025

2026

2025

Revenue

Amount

$        58,848

$        55,372

$         3,128

$         3,199

$         1,721

$         1,609

Growth rate

6 %

— %

(2) %

3 %

7 %

37 %

Segment profit

Amount

$             645

$             535

$            150

$              70

$            183

$            160

Growth rate

21 %

11 %

N.M.

49 %

14 %

44 %

Segment profit margin

1.10 %

0.97 %

4.80 %

2.19 %

10.63 %

9.94 %

Fiscal Year

Pharmaceutical and Specialty Solutions

Global Medical Products and Distribution

Other

(in millions)

2026

2025

2026

2025

2026

2025

Revenue

Amount

$       234,833

$       204,644

$        12,719

$        12,636

$         6,792

$         5,382

Growth rate

15 %

(3) %

1 %

2 %

26 %

19 %

Segment profit

Amount

$           2,783

$           2,258

$             258

$             135

$           707

$           516

Growth rate

23 %

12 %

91 %

47 %

37 %

22 %

Segment profit margin

1.19 %

1.10 %

2.03 %

1.07 %

10.41 %

9.59 %

The sum of the components and certain computations may reflect rounding adjustments.

Schedule 5

Cardinal Health, Inc. and Subsidiaries

GAAP / Non-GAAP Reconciliation1 (Unaudited)

Net

(Earnings)/

Loss

Gross

Operating

Earnings

Provision

Attributable

Net

Diluted

Margin

SG&A2

Earnings

Before

for

to Non-

Earnings3

Effective

EPS 3

(in millions, except per common share amounts)

Gross

Growth

Growth

Operating

Growth

Income

Income

Controlling

Net

Growth

Tax

Diluted

Growth

Margin

Rate

SG&A 2

Rate

Earnings

Rate

Taxes

Taxes

Interests

Earnings3

Rate

Rate

EPS 3

Rate

Fourth Quarter 2026

GAAP

$ 2,560

16 %

$ 1,625

10 %

$    729

70 %

$   554

$    154

$       (2)

$    398

67 %

27.9 %

$ 1.70

70 %

Restructuring and employee severance

—

—

40

40

9

—

31

0.13

Amortization and other acquisition-related costs

—

—

121

121

28

—

93

0.40

Acquisition-related cash & share-based compensation costs

—

—

44

44

3

—

41

0.18

Impairments and (gain)/loss on disposal of assets, net

—

—

4

4

3

—

1

—

Litigation (recoveries)/charges, net

—

—

(3)

(3)

(3)

—

—

—

Impairment of equity interest in Outcomes 4

—

—

—

122

3

—

119

0.51

Non-GAAP

$ 2,560

16 %

$ 1,625

10 %

$    935

30 %

$   882

$    198

$       (2)

$    682

36 %

22.5 %

$ 2.91

40 %

Fourth Quarter 2025

GAAP

$ 2,202

17 %

$ 1,484

16 %

$    428

7 %

$    384

$    141

$       (4)

$    239

2 %

36.9 %

$ 1.00

4 %

Restructuring and employee severance

—

—

27

27

6

—

21

0.09

Amortization and other acquisition-related costs

—

—

133

133

23

2

112

0.46

Acquisition-related cash & share-based compensation costs

—

—

106

106

1

4

109

0.45

Impairments and (gain)/loss on disposal of assets, net

—

—

33

33

9

—

24

0.10

Litigation (recoveries)/charges, net

—

—

(9)

(9)

(2)

—

(7)

(0.03)

Non-GAAP

$  2,203

17 %

$ 1,484

16 %

$    719

19 %

$    676

$    178

$        3

$    501

11 %

26.3 %

$ 2.08

13 %

1 For more information on these measures, refer to the Use of Non-GAAP Measures and Definitions schedules.

2 Distribution, selling, general and administrative expenses.

3 Attributable to Cardinal Health, Inc.

4 For fiscal 2026, we recognized a pre-tax impairment charge of $122 million related to our equity method investment in Outcomes due to an observed reduction in the estimated fair value of the business, which is included in impairment of equity interest in Outcomes in the consolidated statements of earnings. The net tax benefit related to this charge was $3 million and is included in the annual effective tax rate.

The sum of the components and certain computations may reflect rounding adjustments.

We generally apply varying tax rates depending on the item's nature and tax jurisdiction where it is incurred.

Schedule 5

Cardinal Health, Inc. and Subsidiaries

GAAP / Non-GAAP Reconciliation1 (Unaudited)

Net

(Earnings)/

Loss

Gross

Operating

Earnings

Provision

Attributable

Net

Diluted

Margin

SG&A2

Earnings

Before

for

to Non-

Earnings3

Effective

EPS 3

Gross

Growth

Growth

Operating

Growth

Income

Income

Controlling

Net

Growth

Tax

Diluted

Growth

(in millions, except per common share amounts)

Margin

Rate

SG&A 2

Rate

Earnings

Rate

Taxes

Taxes

Interests

Earnings3

Rate

Rate

EPS 3

Rate

Fiscal Year 2026

GAAP

$ 9,774

20 %

$ 6,132

14 %

$   2,613

15 %

$  2,174

$    469

$        9

$  1,714

10 %

21.6 %

$ 7.23

12 %

State opioid assessment related to prior fiscal years

—

17

(17)

(17)

(4)

—

(13)

(0.05)

Restructuring and employee severance

—

—

106

106

24

—

82

0.34

Amortization and other acquisition-related costs

—

—

469

469

120

—

349

1.47

Acquisition-related cash & share-based compensation costs

—

—

287

287

12

—

275

1.16

Impairments and (gain)/loss on disposal of assets, net 5

—

—

177

177

22

(23)

132

0.56

Litigation (recoveries)/charges, net

—

—

(10)

(10)

(19)

—

9

0.04

Impairment of equity interest in Outcomes 4

—

—

—

122

3

—

119

0.50

Non-GAAP

$ 9,774

20 %

$ 6,150

14 %

$   3,624

30 %

$  3,308

$    628

$      (13)

$  2,667

34 %

19.0 %

$ 11.26

37 %

Fiscal Year 2025

GAAP

$ 8,168

10 %

$ 5,382

8 %

$   2,275

83 %

$  2,101

$    532

$        (8)

$   1,561

83 %

25.3 %

$ 6.45

87 %

Restructuring and employee severance

—

—

88

88

21

—

67

0.28

Amortization and other acquisition-related costs

—

—

464

464

104

—

360

1.49

Acquisition-related cash & share-based compensation costs

—

—

126

126

1

—

125

0.51

Impairments and (gain)/loss on disposal of assets, net

—

—

18

18

5

—

13

0.05

Litigation (recoveries)/charges, net

—

—

(185)

(185)

(54)

—

(131)

(0.54)

Non-GAAP

$ 8,168

10 %

$ 5,382

8 %

$   2,786

15 %

$  2,612

$    609

$       (8)

$   1,995

7 %

23.3 %

$ 8.24

9 %

Fiscal Year 2024

GAAP

$ 7,414

8 %

$ 5,000

4 %

$   1,243

65 %

$  1,201

$    348

$       (1)

$    852

N.M.

28.9 %

$ 3.45

N.M.

Shareholder cooperation agreement costs

—

(1)

1

1

—

—

1

—

Restructuring and employee severance

—

—

175

175

41

—

134

0.54

Amortization and other acquisition-related costs

—

—

284

284

74

—

210

0.85

Impairments and (gain)/loss on disposal of assets, net 5

—

—

634

634

47

—

587

2.38

Litigation (recoveries)/charges, net

—

—

78

78

5

—

73

0.30

Non-GAAP

$ 7,414

8 %

$ 5,000

4 %

$   2,414

16 %

$  2,372

$    515

$       (1)

$   1,856

21 %

21.7 %

$ 7.53

29 %

1 For more information on these measures, refer to the Use of Non-GAAP Measures and Definitions schedules.

2 Distribution, selling, general and administrative expenses.

3 Attributable to Cardinal Health, Inc.

4 For fiscal 2026, we recognized a pre-tax impairment charge of $122 million related to our equity method investment in Outcomes due to an observed reduction in the estimated fair value of the business, which is included in impairment of equity interest in Outcomes in the consolidated statements of earnings. The net tax benefit related to this charge was $3 million and is included in the annual effective tax rate.

5 For fiscal 2026 and 2024, impairments and (gain)/loss on disposals of assets, net includes pre-tax goodwill impairment charges of $184 million related to the Navista & ION reporting unit within the Pharma segment and $675 million related to the GMPD segment, respectively. For fiscal 2026 and 2024 the net tax benefit related to these charges was $23 million and $58 million, respectively, and were included in the annual effective tax rates. The portion of the goodwill impairment charge within the Navista & ION reporting unit attributable to noncontrolling interests was $23 million for fiscal 2026.

The sum of the components and certain computations may reflect rounding adjustments.

We generally apply varying tax rates depending on the item's nature and tax jurisdiction where it is incurred.

Schedule 6

Cardinal Health, Inc. and Subsidiaries

GAAP / Non-GAAP Reconciliation - GAAP Cash Flow to Non-GAAP Adjusted Free Cash Flow (Unaudited)

Fiscal Year

(in millions)

2026

2025

GAAP - Cash Flow Categories

Net cash provided by operating activities

$    5,174

$    2,397

Net cash used in investing activities

(2,584)

(5,593)

Net cash provided by/(used in) financing activities

(1,602)

1,940

Effect of exchange rates changes on cash and equivalents

(6)

(3)

Net increase/(decrease) in cash and equivalents

$       982

$   (1,259)

Non-GAAP Adjusted Free Cash Flow

Net cash provided by operating activities

$    5,174

$    2,397

Repurchases of liability-classified Specialty Alliance Units

45

19

Additions to property and equipment

(649)

(547)

Payments related to matters included in litigation (recoveries)/charges, net

401

619

Non-GAAP Adjusted Free Cash Flow

$    4,971

$    2,488

For more information on these measures, refer to the Use of Non-GAAP Measures and Definitions schedules.

Schedule 7

Cardinal Health, Inc. and Subsidiaries

Global Medical Product Distribution ("GMPD") and Consolidated

 International Emergency Economic Powers Act ("IEEPA") Tariff Refunds Reconciliation (Unaudited)

Global Medical Product Distribution

Fourth Quarter

Fiscal Year

(in millions)

2026

2025

Growth Rate

2026

2025

Growth Rate

Segment profit

$       150

$        70

N.M.

$       258

$       135

91 %

Less: IEEPA tariff refunds

100

—

100 %

100

—

100 %

Segment profit, excluding IEEPA tariff refunds

$         50

$        70

(29) %

$       158

$       135

17 %

Consolidated

Fourth Quarter

Fiscal Year

(in millions)

2026

2025

Growth Rate

2026

2025

Growth Rate

Net earnings 1

$       398

$       239

67 %

$    1,714

$    1,561

10 %

Less: IEEPA tariff refunds, net of tax

74

—

100 %

74

—

100 %

Net earnings, excluding IEEPA tariff refunds

$       324

$       239

36 %

$    1,640

$    1,561

5 %

Diluted EPS

$      1.70

$      1.00

70 %

$      7.23

$      6.45

12 %

Less: Diluted EPS, IEEPA tariff refunds, net of tax

0.31

—

100 %

0.31

—

100 %

Diluted EPS, excluding IEEPA tariff refunds

$      1.39

$      1.00

39 %

$      6.92

$      6.45

7 %

Consolidated

Fourth Quarter

Fiscal Year

(in millions)

2026

2025

Growth Rate

2026

2025

Growth Rate

Non-GAAP Net earnings 1

$       682

$       501

36 %

$     2,667

$    1,995

34 %

Less: IEEPA tariff refunds, net of tax

74

—

100 %

74

—

100 %

Non-GAAP Net earnings, excluding IEEPA tariff refunds

$       608

$       501

21 %

$     2,593

$    1,995

30 %

Non-GAAP Diluted EPS

$      2.91

$      2.08

40 %

$     11.26

$      8.24

37 %

Less: Non-GAAP Diluted EPS, IEEPA tariff refunds, net of tax

0.31

—

100 %

0.31

—

100 %

Non-GAAP Diluted EPS, excluding IEEPA tariff refunds

$      2.60

$      2.08

25 %

$     10.95

$      8.24

33 %

1 Attributable to Cardinal Health, Inc.

Schedule 8

Cardinal Health, Inc. and Subsidiaries

Distribution, Selling, General and Administrative ("SG&A") Expenses, excluding Acquisitions

Consolidated

Fourth Quarter

Fiscal Year

(in millions)

2026

2025

% Change

2026

2025

% Change

SG&A expenses

$     1,625

$     1,484

10 %

$     6,132

$     5,382

14 %

Less: Recent acquisitions1

198

157

26 %

767

254

N.M.

SG&A expenses, excluding recent acquisitions

$     1,427

$     1,327

8 %

$     5,365

$     5,128

5 %

1Recent acquisitions include Integrated Oncology Network (December 2024), GI Alliance (January 2025), Advanced Diabetes Supply Group (April 2025), Urology America (May 2025), and Solaris Health (November 2025).

Cardinal Health, Inc. and Subsidiaries

Use of Non-GAAP Measures

This earnings release contains financial measures that are not calculated in accordance with U.S. generally accepted accounting principles ("GAAP").

In addition to analyzing our business based on financial information prepared in accordance with GAAP, we use these non-GAAP financial measures internally to evaluate our performance, engage in financial and operational planning, and determine incentive compensation because we believe that these measures provide additional perspective on and, in some circumstances are more closely correlated to, the performance of our underlying, ongoing business. We provide these non-GAAP financial measures to investors as supplemental metrics to assist readers in assessing the effects of items and events on our financial and operating results on a year-over-year basis and in comparing our performance to that of our competitors. However, the non-GAAP financial measures that we use may be calculated differently from, and therefore may not be comparable to, similarly titled measures used by other companies. The non-GAAP financial measures disclosed by us should not be considered a substitute for, or superior to, financial measures calculated in accordance with GAAP, and the financial results calculated in accordance with GAAP and reconciliations to those financial statements set forth below should be carefully evaluated. 

Exclusions from Non-GAAP Financial Measures

Management believes it is useful to exclude the following items from the non-GAAP measures presented in this report for its own and for investors' assessment of the business for the reasons identified below:

LIFO charges and credits are excluded because the factors that drive last-in first-out ("LIFO") inventory charges or credits, such as pharmaceutical manufacturer price appreciation or deflation and year-end inventory levels (which can be meaningfully influenced by customer buying behavior immediately preceding our fiscal year-end), are largely out of our control and cannot be accurately predicted. The exclusion of LIFO charges and credits from non-GAAP metrics facilitates comparison of our current financial results to our historical financial results and to our peer group companies' financial results. We did not recognize any LIFO charges or credits during the periods presented. State opioid assessments related to prior fiscal years is the portion of state assessments for prescription opioid medications that were sold or distributed in periods prior to the period in which the expense is incurred. This portion is excluded from non-GAAP financial measures because it is retrospectively applied to sales in prior fiscal years and inclusion would obscure analysis of the current fiscal year results of our underlying, ongoing business. Additionally, while states' laws may require us to make payments on an ongoing basis, the portion of the assessment related to sales in prior periods are contemplated to be one-time, nonrecurring items. Income from state opioid assessments related to prior fiscal years represents reversals of accruals due to changes in estimates or when the underlying assessments were invalidated by a court or reimbursed by manufacturers.  Shareholder cooperation agreement costs includes costs such as legal, consulting, and other expenses incurred in relation to the agreement (the "Cooperation Agreement") entered into among Elliott Associates, L.P., Elliott International, L.P. (together, "Elliott"), and Cardinal Health. These include costs incurred to negotiate and finalize the Cooperation Agreement and costs incurred by the Business Review Committee of the Board of Directors, formed under this Cooperation Agreement, tasked with undertaking a comprehensive review of our strategy, portfolio, capital allocation framework, and operations. We have excluded these costs from our non-GAAP metrics because they do not occur in or reflect the ordinary course of our ongoing business operations and may obscure analysis of trends and financial performance. The Cooperation Agreement expired in the second quarter of fiscal 2025. Restructuring and employee severance costs are excluded because they are not part of the ongoing operations of our underlying business and include, but are not limited to, costs related to divestitures, closing and consolidating facilities, changing the way we manufacture or distribute our products, moving manufacturing of a product to another location, changes in production or business process outsourcing or insourcing, employee severance, and realigning operations.  Amortization and other acquisition-related costs, which include transaction costs, integration costs, and changes in the fair value of contingent consideration obligations, are excluded because they are not part of the ongoing operations of our underlying business and to facilitate comparison of our current financial results to our historical financial results and to our peer group companies' financial results. Additionally, costs for amortization of acquisition-related intangible assets and amortization as a result of basis differences in equity method investments are non-cash amounts, which are variable in amount and frequency and are significantly impacted by the timing and size of acquisitions, so their exclusion facilitates comparison of historical, current, and forecasted financial results. We also exclude other acquisition-related costs, which are directly related to an acquisition but do not meet the criteria to be recognized on the acquired entity's initial balance sheet as part of the purchase price allocation. These costs are also significantly impacted by the timing, complexity, and size of acquisitions.  Acquisition-related cash and share-based compensation costs are incurred in connection with contingent cash payments or the issuance of share-based payment awards, which include service requirements, as a part of certain physician practice acquisitions. These costs include fair value adjustments for liability-classified awards. These costs are excluded because they are unrelated to the underlying operating results of our business and to facilitate comparison of our current financial results to our historical financial results and to our peer group companies' financial results. In addition, the magnitude of these expenses is significantly impacted by the timing and size of the acquisitions of physician practices. Impairments and gain or loss on disposal of assets, net are excluded because they do not occur in or reflect the ordinary course of our ongoing business operations and are inherently unpredictable in timing and amount, and in the case of impairments, are non-cash amounts, so their exclusion facilitates comparison of historical, current, and forecasted financial results.  Litigation recoveries or charges, net are excluded because they often relate to events that may have occurred in prior or multiple periods, do not occur in or reflect the ordinary course of our business, and are inherently unpredictable in timing and amount.  Impairment of equity interest in Outcomes was incurred in connection with the observed reduction in the estimated fair value of the Outcomes business, of which we hold a 16 percent equity interest. We exclude this impairment from non-GAAP results as impairments of unconsolidated equity investments of this magnitude do not occur in the normal course of our ongoing business operations. This impairment is similar in nature to a gain or loss on the divestiture of a majority interest, which we also exclude from non-GAAP results, including the gain recognized on our initial divestiture of the Outcomes business in fiscal 2024. The exclusion of this impairment from non-GAAP financial measures facilitates comparison of our current financial results to our historical financial results. The tax effect for each of the items listed above is determined using the tax rate and other tax attributes applicable to the item and the jurisdiction(s) in which the item is recorded. The gross, tax, and net impact of each item are presented with our GAAP to non-GAAP reconciliations.

Non-GAAP adjusted free cash flow: We provide this non-GAAP financial measure as a supplemental metric to assist readers in assessing the effects of items and events on our cash flow on a year-over-year basis and in comparing our performance to that of our peer group companies. In calculating this non-GAAP metric, certain items are excluded from net cash provided by operating activities because they relate to significant and unusual or non-recurring events and are inherently unpredictable in timing and amount. We believe adjusted free cash flow is important to management and useful to investors as a supplemental measure as it indicates the cash flow available for working capital needs, debt repayments, dividend payments, share repurchases, strategic acquisitions, or other strategic uses of cash. A reconciliation of our GAAP financial results to Non-GAAP adjusted free cash flow is provided in Schedule 6 of the financial statement tables included with this release.

Forward Looking Non-GAAP Measures

In this document, the Company presents certain forward-looking non-GAAP metrics. The Company does not provide outlook on a GAAP basis because the items that the Company excludes from GAAP to calculate the comparable non-GAAP measure can be dependent on future events that are less capable of being controlled or reliably predicted by management and are not part of the Company's routine operating activities. Additionally, management does not forecast many of the excluded items for internal use and therefore cannot create or rely on outlook done on a GAAP basis.
 

The occurrence, timing and amount of any of the items excluded from GAAP to calculate non-GAAP could significantly impact the Company's fiscal 2026 GAAP results. Over the past five fiscal years, the excluded items have impacted the Company's EPS from $1.79 to $8.44, which includes a $6.97 change related to the goodwill impairment we recognized in fiscal 2022.

Definitions

Growth rate calculation: growth rates in this report are determined by dividing the difference between current-period results and prior-period results by prior-period results.

Interest and Other, net: other (income)/expense, net plus interest expense, net.

Segment Profit: segment revenue minus (segment cost of products sold and segment distribution, selling, general and administrative expenses).

Segment Profit margin: segment profit divided by segment revenue.

Non-GAAP gross margin: gross margin, excluding LIFO charges/(credits).

Non-GAAP distribution, selling, general and administrative expenses or Non-GAAP SG&A: distribution, selling, general and administrative expenses, excluding state opioid assessment related to prior fiscal years and shareholder cooperation agreement costs.

Non-GAAP operating earnings: operating earnings excluding (1) LIFO charges/(credits), (2) state opioid assessment related to prior fiscal years, (3) shareholder cooperation agreement costs, (4) restructuring and employee severance, (5) amortization and other acquisition-related costs, (6) acquisition-related cash and share-based compensation costs, (7) impairments and (gain)/loss on disposal of assets, net, and (8) litigation (recoveries)/charges, net.

Non-GAAP earnings before income taxes: earnings before income taxes excluding (1) LIFO charges/(credits), (2) state opioid assessment related to prior fiscal years, (3) shareholder cooperation agreement costs, (4) restructuring and employee severance, (5) amortization and other acquisition-related costs, (6) acquisition-related cash and share-based compensation costs, (7) impairments and (gain)/loss on disposal of assets, net, (8) litigation (recoveries)/charges, net, and (9) impairment of equity interest in Outcomes.

Non-GAAP net earnings attributable to non-controlling interests: net earnings attributable to non-controlling interests excluding (1) LIFO charges/(credits), (2) state opioid assessment related to prior fiscal years, (3) shareholder cooperation agreement costs, (4) restructuring and employee severance, (5) amortization and other acquisition-related costs, (6) acquisition-related cash and share-based compensation costs, (7) impairments and (gain)/loss on disposal of assets, net, (8) litigation (recoveries)/charges, net, and (9) impairment of equity interest in Outcomes, each net of tax.

Non-GAAP net earnings attributable to Cardinal Health, Inc.: net earnings attributable to Cardinal Health, Inc. excluding (1) LIFO charges/(credits), (2) state opioid assessment related to prior fiscal years, (3) shareholder cooperation agreement costs, (4) restructuring and employee severance, (5) amortization and other acquisition-related costs, (6) acquisition-related cash and share-based compensation costs, (7) impairments and (gain)/loss on disposal of assets, net, (8) litigation (recoveries)/charges, net, and (9) impairment of equity interest in Outcomes, each net of tax.

Non-GAAP effective tax rate: provision for income taxes adjusted for the tax impacts of (1) LIFO charges/(credits), (2) state opioid assessment related to prior fiscal years, (3) shareholder cooperation agreement costs, (4) restructuring and employee severance, (5) amortization and other acquisition-related costs, (6) acquisition-related cash and share-based compensation costs, (7) impairments and (gain)/loss on disposal of assets, net, (8) litigation (recoveries)/charges, net, and (9) impairment of equity interest in Outcomes, divided by (earnings before income taxes adjusted for the items above).

Non-GAAP diluted earnings per share attributable to Cardinal Health, Inc.: non-GAAP net earnings attributable to Cardinal Health, Inc. divided by diluted weighted-average shares outstanding.

Non-GAAP adjusted free cash flow: net cash provided by operating activities plus repurchases of liability-classified Specialty Alliance Units, less payments related to additions to property and equipment, excluding settlement payments and receipts related to matters included in litigation (recoveries)/charges, net, as defined above, or other significant and unusual or non-recurring cash payments or receipts.

SOURCE Cardinal Health, Inc.

Key Takeaways Cardinal Health is expected to post Q4 sales of $65.61B, up 9.1%, with EPS projected to rise 16.4%.CAH's Pharmaceutical and Specialty Solutions business likely stayed a key growth driver on strong demand.Cardinal Health's GMPD unit faced tariff, inflation and customer volume pressures despite cost initiatives. Cardinal Health (CAH - Free Report) is scheduled to report fourth-quarter fiscal 2027 results on Aug. 11, before market open.

The Zacks Consensus Estimate for sales is pegged at $65.61 billion, implying 9.1% year-over-year growth. The bottom line estimate is pinned at $2.42, suggesting growth of 16.4%.

The EPS estimates have remained stable over the past seven days.

The company delivered an earnings surprise of 13.21% in the last reported quarter. Its earnings beat estimates in each of the trailing four quarters, delivering an average surprise of 10.27%.

What the Zacks Model UnveilsOur proven model predicts an earnings beat for Cardinal Health this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the chances of an earnings beat. This is not the case here, as you will see below.

Earnings ESP: Earnings ESP, which represents the difference between the Most Accurate Estimate ($2.45 per share) and the Zacks Consensus Estimate is +1.24% for CAH. You can uncover the best stocks to buy or sell before they're reported with our Earnings ESP Filter.

Zacks Rank: The company carries a Zacks Rank #2 at present. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Factors Likely to Have Driven Q4 PerformanceCardinal Health is expected to have delivered robust performance during the fourth quarter of fiscal 2026, supported by sustained momentum in its Pharmaceutical and Specialty Solutions business and continued strength across its higher-margin growth businesses. Pharmaceutical demand is likely to have remained healthy across specialty, branded, generic and consumer health products.

The ongoing expansion of the company's specialty platform, including Solaris integration and its Specialty Alliance physician network, should have continued to boost revenue growth. Management had previously indicated that specialty revenues were growing at more than 20% and were expected to exceed $50 billion in fiscal 2026, suggesting that the segment likely remained a key driver of earnings.

Within the Pharmaceutical segment, profit growth is expected to have continued outpacing revenue growth, supported by favorable branded and specialty product contributions, resilient generic market dynamics, and preserved economics on distribution contracts despite Inflation Reduction Act (IRA)-related pricing changes. However, revenue growth may have remained moderate due to lower wholesale acquisition cost (WAC) pricing under the IRA, slower GLP-1 growth normalization and ongoing loss-of-exclusivity transitions.

The Global Medical Products and Distribution (GMPD) segment is likely to have remained a mixed performer. Continued growth in Cardinal Health-branded products, cost optimization initiatives and operational simplification should have supported underlying execution, although tariffs, selective customer volume losses and inflationary pressures on certain product categories may have continued weighing on profitability.

Meanwhile, the company's Other businesses — At-Home Solutions, Nuclear and Precision Health Solutions, and OptiFreight Logistics — are expected to have sustained their robust growth trend, aided by strong demand, theranostics expansion, ADS integration synergies and logistics volume gains.

Continued investments in technology, automation and distribution infrastructure are also likely to have supported long-term growth. Cardinal Health's disciplined capital allocation, ongoing share repurchases and resilient operating execution are expected to have supported another quarter of healthy earnings growth despite persistent pricing and tariff-related headwinds.

CAH Share Price PerformanceIn the year-to-date period, CAH shares have rallied 15.6%, outperforming its industry’s 4.8% growth over the same period.

CAH has also comfortably outpaced the S&P 500’s 12.7% gain, underscoring strong investor confidence in the company's specialty momentum and expansion in theranostic and at-home services.

Image Source: Zacks Investment Research

CAH has also delivered markedly stronger returns than its MedTech peers. While McKesson (MCK - Free Report) has gained 6.2% year to date, Cencora (COR - Free Report) has declined 3.8%. The stock has also significantly outperformed the broader Zacks Medical sector, which has generated a modest 0.9% return during the same period.

CAH’s Key Valuation MetricFrom a valuation standpoint, Cardinal Health is trading at a forward 12-month price-to-earnings (P/E) multiple of 19.5X, reflecting a premium valuation relative to its MedTech peers.

The elevated multiple suggests that investors are assigning a higher valuation to the company's long-term growth prospects, particularly its specialty expansion and productivity gains from high-growth businesses.

CAH currently trades well above Cencora, which carries a forward 12-month P/E of 16.65X, and McKesson, which is valued at 18.84X sales.

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CAH’s Long-Term Investment VisibilityCardinal Health's focus on transforming its business toward higher-margin specialty healthcare services, while reinforcing the resilience of its core Pharmaceutical distribution franchise, is likely to drive long-term growth. Management continues to expand its Specialty platform through investments in specialty distribution, physician management services (MSOs), biopharma solutions and strategic acquisitions.

The integration of Solaris into the Specialty Alliance, continued expansion of its multi-specialty physician network through tuck-in acquisitions, and growing collaboration between Specialty Networks, MSOs and Nuclear businesses are expected to deepen customer relationships and drive above-market specialty growth.

The company also expects specialty revenues to exceed $50 billion in fiscal 2026, underscoring the increasing importance of this business to long-term earnings. Cardinal Health continues to strengthen its pharmaceutical distribution network through automation, productivity initiatives, and technology investments, enabling it to deliver record service levels while preserving distribution economics despite pricing changes under the Inflation Reduction Act (IRA).

Beyond Pharma, Cardinal Health is building multiple long-term growth engines across At-Home Solutions, Nuclear and Precision Health Solutions, and OptiFreight Logistics, all of which continue to benefit from favorable healthcare trends. The company is investing to expand its home health distribution capacity, integrate ADS, grow the ContinuCare Pathway program, and capitalize on the ongoing shift toward home-based care.

Cardinal Health's Nuclear and Precision Health Solutions segment continues to strengthen its position in theranostics through increased Actinium-225 production capacity and expanding pharmaceutical collaborations, supporting future growth as targeted cancer therapies gain traction. At the same time, the company is advancing enterprise-wide initiatives focused on operational efficiency, supply-chain resilience, prudent capital deployment, and selective acquisitions, while pursuing a multiyear turnaround effort in GMPD. Combined with robust cash flow, continued buybacks, technology investments, and a growing mix of higher-margin businesses, these efforts should support durable earnings growth and long-term value creation for shareholders.

Cardinal Health (CAH - Free Report) ended the recent trading session at $230.11, demonstrating a -1.52% change from the preceding day's closing price. This move lagged the S&P 500's daily gain of 0.38%. Meanwhile, the Dow experienced a rise of 0.02%, and the technology-dominated Nasdaq saw an increase of 0.9%.

The stock of prescription drug distributor has risen by 3.21% in the past month, lagging the Medical sector's gain of 4.34% and overreaching the S&P 500's gain of 1.27%.

The upcoming earnings release of Cardinal Health will be of great interest to investors. The company's earnings report is expected on August 11, 2026. In that report, analysts expect Cardinal Health to post earnings of $2.42 per share. This would mark year-over-year growth of 16.35%. Meanwhile, our latest consensus estimate is calling for revenue of $65.61 billion, up 9.06% from the prior-year quarter.

For the full year, the Zacks Consensus Estimates project earnings of $10.77 per share and a revenue of $256.24 billion, demonstrating changes of +30.7% and +15.12%, respectively, from the preceding year.

Investors should also note any recent changes to analyst estimates for Cardinal Health. These latest adjustments often mirror the shifting dynamics of short-term business patterns. Therefore, positive revisions in estimates convey analysts' confidence in the business performance and profit potential.

Research indicates that these estimate revisions are directly correlated with near-term share price momentum. To exploit this, we've formed the Zacks Rank, a quantitative model that includes these estimate changes and presents a viable rating system.

The Zacks Rank system ranges from #1 (Strong Buy) to #5 (Strong Sell). It has a remarkable, outside-audited track record of success, with #1 stocks delivering an average annual return of +25% since 1988. The Zacks Consensus EPS estimate has moved 0.29% higher within the past month. Cardinal Health currently has a Zacks Rank of #2 (Buy).

Valuation is also important, so investors should note that Cardinal Health has a Forward P/E ratio of 19.45 right now. This signifies a premium in comparison to the average Forward P/E of 17.08 for its industry.

It is also worth noting that CAH currently has a PEG ratio of 1.14. The PEG ratio is similar to the widely-used P/E ratio, but this metric also takes the company's expected earnings growth rate into account. By the end of yesterday's trading, the Medical - Dental Supplies industry had an average PEG ratio of 1.86.

The Medical - Dental Supplies industry is part of the Medical sector. With its current Zacks Industry Rank of 64, this industry ranks in the top 27% of all industries, numbering over 250.

The Zacks Industry Rank assesses the vigor of our specific industry groups by computing the average Zacks Rank of the individual stocks incorporated in the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

Be sure to follow all of these stock-moving metrics, and many more, on Zacks.com.

Key Takeaways Cardinal Health shares are up 7.9% YTD after gaining 74% in 2025 on strong execution.CAH raised fiscal 2026 guidance after reporting 35% EPS growth in third-quarter results.Cardinal Health is expanding specialty pharma, advanced therapies and higher-margin services. After delivering a remarkable 74% gain in 2025, shares of Cardinal Health (CAH - Free Report) have climbed another 7.9% year to date, reflecting continued investor confidence in the company’s evolving growth strategy. The rally can be attributed to consistently strong earnings execution, accelerating specialty pharmaceutical expansion and growing contribution from higher-margin healthcare services businesses.

CAH stock has outperformed its closest peers, McKesson (MCK - Free Report) and Cencora, Inc. (COR - Free Report) , so far this year. Over the same period, shares of McKesson have lost 8.5%, while those of Cardinal Health have declined 19.5%.

On its fiscal third-quarter 2026 earnings call, Cardinal Health once again raised earnings guidance after reporting 35% earnings per share (EPS) growth, underscoring management’s confidence in sustained operational momentum. While macro uncertainties and pricing headwinds remain, Cardinal Health is increasingly transforming itself from a traditional pharmaceutical distributor into a diversified healthcare infrastructure company positioned to benefit from specialty medicine growth, advanced therapies and expanding outpatient care trends.

YTD Performance: CAH vs Industry & Peers

Image Source: Zacks Investment Research

Key Growth Drivers

Specialty Pharmaceutical Business Continues to Power Core Growth: Cardinal Health’s Pharmaceutical and Specialty Solutions business remains its primary growth engine. In the fiscal third quarter, segment revenues rose 11% to $56.1 billion while segment profit jumped 18%, significantly outpacing top-line growth.

Specialty revenues continue to expand above market rates, with management expecting specialty sales to exceed $50 billion in fiscal 2026. Growth is being supported by expanding manufacturer partnerships, specialty distribution and increasing penetration across physician practices.

MSO Platform Expansion Strengthens Competitive Position: The company continues to focus on expanding its physician-focused management services organization (MSO) platform, a key strategy to support long-term growth. Management highlighted continued progress with integrating Solaris into Specialty Alliance, helping expand multispecialty physician offerings.

This strengthens Cardinal Health’s downstream presence with providers while deepening relationships with manufacturers. As specialty drugs become increasingly complex and high-value, the physician networks should help drive durable growth through improved care coordination and service differentiation.

Advanced Therapies and Radiopharma Offer High-Growth Opportunities: Cardinal Health is aggressively positioning itself in next-generation therapies. Its recent 2026 Advanced Therapies report highlighted strong industry momentum toward moving gene and cell therapies into community-based care settings.

Simultaneously, the company significantly expanded Actinium-225 production capacity after already quadrupling output since late 2024. As targeted alpha therapies and radiopharmaceuticals are rapidly emerging as key oncology growth areas, Cardinal Health is building early leadership in this potentially multibillion-dollar market.

Adjacent Businesses Are Becoming Meaningful Profit Drivers: Beyond core pharmaceutical distribution, Cardinal Health’s newer healthcare businesses are scaling rapidly. The company reported 31% revenue growth and 34% profit increase in its “Other Growth Businesses” segment, driven by At-Home Solutions, Nuclear and Precision Health Solutions, and OptiFreight Logistics.

Particularly noteworthy is theranostics, where Nuclear and Precision Health Solutions delivered more than 30% growth, reflecting rising demand for precision medicine and oncology-focused diagnostics.

Estimate Revision Trend for CAHEstimates for Cardinal Health’s fiscal 2026 earnings have moved up 16.5% to $10.76 per share over the past year, while the same for fiscal 2027 earnings has improved 17.2% to $11.98. The positive estimate revision depicts bullish sentiments for the stock.

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Competition Remains Intense as Rivals Expand Similar Specialty StrategiesCardinal Health continues to face aggressive competition from McKesson and Cencora, both of which are pursuing similar specialty-driven strategies. McKesson delivered 18% adjusted EPS growth in fiscal 2026 while expanding oncology and multispecialty platforms, adding over 570 providers and strengthening AI-enabled supply-chain capabilities.

Cencora continues to invest heavily in specialty pharmaceuticals, oncology-focused MSO platforms and digital infrastructure through its OneOncology acquisition. Compared with peers, Cardinal Health currently stands out for stronger earnings momentum and faster scaling of high-margin businesses like theranostics and precision health, giving it a relative execution advantage entering the second half of 2026.

Valuation OutlookCardinal Health’s improving fundamentals have translated into stronger earnings visibility and guidance. Strong earnings momentum supports the stock’s performance and suggests that Cardinal Health remains attractively positioned relative to its historical growth profile.

CAH’s shares currently trade at a forward 12-month price-to-earnings (P/E) of 18.57X, higher than the industry average of 16.15X.

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Risks and Challenges Could Limit Further UpsideDespite strong momentum, several risks remain. Tariff exposure continues to put pressure on Cardinal Health’s GMPD segment, where profits declined due to adverse tariff impacts despite operational improvements. Growth in GLP-1 drug sales has moderated after prior strength, while Inflation Reduction Act pricing adjustments continue to hurt pharmaceutical revenue growth.

Rising competitive intensity in specialty distribution from McKesson and Cencora could pressure market share gains. Execution risk around scaling newer businesses, such as radiopharma and advanced therapies, also remains an important factor for investors monitoring the stock’s next move.

CAH’s Zacks Rank & Another Key PickCurrently, Cardinal Health has a Zacks Rank #2 (Buy).

West Pharmaceutical (WST - Free Report) is another top-ranked stock from the broader medical space. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

West Pharmaceutical, sporting a Zacks Rank #1 at present, reported first-quarter 2026 earnings per share (EPS) of $2.13, which beat the Zacks Consensus Estimate by 26.8%. Revenues of $844.9 million surpassed the Zacks Consensus Estimate by 8.5%.

West Pharmaceutical has an estimated long-term earnings growth rate of 13.9%. WST’s earnings surpassed estimates in each of the trailing four quarters, the average surprise being 19.4%.