McKesson (MCK) Stock Gains 18% YTD: What's Driving the Rally?

Core Viewpoint - McKesson (MCK) is experiencing strong momentum with an 18.3% share price increase year to date, outperforming the industry growth of 0.6% and the S&P 500's 16.5% rise [1] Group 1: Company Performance - McKesson has raised its adjusted earnings per share (EPS) guidance for fiscal 2025 to a range of $31.75-$32.55, up from $31.25-$32.05, indicating a growth of 16-19% from the previous year [3] - The company expects revenues to grow by 15-17% compared to the prior year [3] - The U.S. Pharmaceutical segment has driven significant growth, with increased prescription volumes, particularly from specialty products and GLP-1 medications [3] Group 2: Market Dynamics - The COVID-19 pandemic has led to improved demand across various medical sectors, particularly in surgeries, contributing to McKesson's growth [4] - Rising product pricing is positively impacting sales [4] - The launch of Project Oasis aims to advance health equity for at-risk populations in underserved communities, which is expected to drive demand for extended and primary care [4] Group 3: Challenges - The Medical-Surgical business faced challenges in the primary care channel during the first quarter, raising concerns about its performance [5] - Although McKesson is enhancing operational efficiency and cost optimization, the benefits may take time to reflect in overall performance [5]