Shares of Cardinal Health, Inc. (NYSE:CAH) have garnered a consensus recommendation of “Moderate Buy” from analysts, according to a report by Marketbeat. Sixteen analysts cover the company, with three rating the stock as a hold and thirteen giving it a buy rating. The average 12-month price target stands at $209.00, reflecting optimism among market observers.
Several investment firms have recently updated their projections for Cardinal Health. Jefferies Financial Group set a price target of $220.00 on November 3, 2023, maintaining a buy rating. On October 31, UBS Group raised its target from $185.00 to $220.00. Meanwhile, Argus increased their price target from $189.00 to $211.00, also issuing a buy rating on November 4.
More bullish projections came from Leerink Partners, which lifted their target from $211.00 to $230.00 on November 17, rating the stock as “outperform.” Conversely, Citigroup adjusted its price target from $165.00 to $190.00 while maintaining a neutral stance.
Strong Quarterly Performance Reported
Cardinal Health disclosed its quarterly earnings on October 30, revealing earnings per share (EPS) of $2.55. This result exceeded analysts’ expectations, which averaged $2.22, by $0.33. The company reported a negative return on equity of 84.37% and a net margin of 0.68%, with quarterly revenue reaching $64.01 billion, surpassing estimates of $59.41 billion. This marks a significant year-over-year revenue increase of 22.4% compared to the same period in the previous year.
Looking ahead, Cardinal Health has set guidance for fiscal year 2026 at an EPS range of $9.650 to $9.850. Analysts anticipate an average EPS of $7.95 for the current year.
Dividend Announcement and Institutional Trading Activity
In addition to its robust earnings, Cardinal Health announced a quarterly dividend of $0.5107 per share, which will be paid on January 15, 2024. Stockholders of record on January 2 will receive this dividend, representing an annualized dividend of $2.04 and a yield of 1.0%. The ex-dividend date is also set for January 2, with a current dividend payout ratio of 30.77%.
Recent trading activity shows institutional investors have been increasingly active in Cardinal Health shares. Wellington Management Group LLP raised its position by 153.2% in the third quarter, now holding 5,804,090 shares valued at approximately $911 million. Norges Bank also made a significant investment in the company, acquiring a new position worth around $584.4 million during the second quarter.
Furthermore, Holocene Advisors LP increased its stake by 141.4% in the third quarter, owning 1,926,170 shares valued at $302.3 million. Zurich Insurance Group Ltd FI expanded its holdings by an impressive 4,935.9%, now owning 946,750 shares worth $130.4 million. Barclays PLC also boosted its position by 109.3%, holding 1,584,214 shares valued at $248.7 million. Overall, institutional investors and hedge funds own approximately 87.17% of Cardinal Health’s stock.
Founded in the early 1970s, Cardinal Health is headquartered in Dublin, Ohio. The company has established itself as a significant provider of supply chain and distribution services in the healthcare sector, catering to hospitals, health systems, pharmacies, physician offices, and clinical laboratories. Its core operations include the wholesale distribution of both branded and generic pharmaceuticals, as well as the supply of medical-surgical products and logistics management solutions.
