McKesson(US:MCK) ZACKSยท2024-08-15 14:02Core Viewpoint - McKesson's stock has underperformed compared to the broader market and its industry, raising questions about its future performance [1] Earnings Estimate Revisions - The current quarter's earnings estimate for McKesson is $7.56 per share, reflecting a year-over-year increase of +21.4%, although the Zacks Consensus Estimate has decreased by -2% in the last 30 days [3] - For the current fiscal year, the consensus earnings estimate is $31.42, indicating a +14.5% change from the previous year, with a slight decrease of -0.9% in the last month [3] - The next fiscal year's consensus estimate is $35.27, showing a +12.2% change year-over-year, with a -1% adjustment in the past month [3] Revenue Growth Projections - The consensus sales estimate for the current quarter is $90.14 billion, representing a +16.7% year-over-year increase [5] - For the current fiscal year, the revenue estimate is $356.2 billion, indicating a +15.3% change, while the next fiscal year's estimate is $386.64 billion, reflecting an +8.5% change [5] Last Reported Results and Surprise History - McKesson reported revenues of $79.28 billion in the last quarter, a +6.4% increase year-over-year, with an EPS of $7.88 compared to $7.27 a year ago [6] - The reported revenues were -4.72% below the Zacks Consensus Estimate of $83.21 billion, while the EPS exceeded estimates by +10.06% [7] - Over the last four quarters, McKesson surpassed consensus EPS estimates three times and revenue estimates twice [7] Valuation - Valuation metrics such as P/E, P/S, and P/CF are essential for assessing whether McKesson's stock is fairly valued compared to its historical values and peers [8] - The Zacks Value Style Score grades McKesson as A, indicating it is trading at a discount relative to its peers [9] Conclusion - McKesson's Zacks Rank of 3 suggests it may perform in line with the broader market in the near term, despite the mixed signals from earnings and revenue estimates [10]