CAH Cardinal Health Inc

Cardinal Health is a major distributor of pharmaceuticals and medical products, serving hospitals, pharmacies, and medical practices across the country. Sector: Healthcare.

Cardinal Health Inc (CAH) is an individual stock. The analysis below presents key financial metrics for the company, covering profitability, capital efficiency, valuation, margins, and growth.

Examining the company through a capital allocation lens, ROIC is 47.41%, WACC is 7.11%, and the economic spread is 40.30%. On balance, the economic spread here is exceptional — few portfolios sustain this kind of gap between operating returns and cost of capital. Supporting metrics show ROE at N/A and ROA at 3.33%, a combination that helps frame whether profitability strength is broad enough to hold through different market conditions. Taken together, the return profile suggests a company with credible compounding capacity if current operating execution persists.

Valuation currently screens at trailing P/E of 30.81, forward P/E of 19.10, PEG of 1.23. The gap between trailing and forward multiples is wide, suggesting the market is pricing meaningful earnings expansion over the coming year. A PEG below 1.5 implies the company's growth rate is not fully reflected in the current multiple — a constructive signal for growth-adjusted value. The aggregate current ratio of 0.91 reflects tighter near-term liquidity — a factor worth monitoring if macro conditions tighten. The valuation profile here is neither obviously cheap nor dramatically expensive — a setup where the return case is built more on earnings delivery than on re-rating potential.

From gross to free cash flow, gross margin sits at 3.70%, operating margin at 1.17%, and free cash flow margin at 2.25%. At this level, gross margins signal that pricing power is constrained and direct cost management is a key performance driver. At this level, operating margins signal that earnings quality is limited — a feature of growth-stage or restructuring businesses. The company's FCF margin signals that most revenue is being consumed before reaching the free cash flow line — a feature of early-stage or heavily invested businesses. The margin profile is mixed, with some layers more resilient than others and less room for execution slippage.

Revenue momentum and analyst targets together paint a picture where the estimated 12-month price change of 14.71%, where consensus expectations favor gradual appreciation over the next year, while TTM revenue growth of 18.75% reflecting moderate but reliable revenue progress across the company. Reported revenue growth is the operational foundation; the analyst target spread shows what the market is willing to pay above it — and that premium can evaporate quickly if delivery slips. For investors, the central question is whether the operating momentum visible in revenues is durable enough to support the price appreciation implied by consensus targets. The estimated 12-month price change is based on analyst consensus price target estimates, sourced from publicly available data, and should not be interpreted as a reliable prediction of future performance.

When all the evidence is placed side by side, this profile stands out as one with genuine compounding characteristics and limited structural headwinds.

This summary is based on publicly available quantitative data and is not intended as investment advice. Carefully consider your personal financial circumstances before making any decisions.