Cardinal Health to Report Q2 Earnings: What's in Store for the Stock?

Core Viewpoint - Cardinal Health, Inc. is set to report its fiscal second-quarter 2025 results on January 30, with expectations of a decline in earnings and revenues compared to the previous year, despite a history of earnings surprises in recent quarters [1][2]. Group 1: Earnings and Revenue Estimates - The Zacks Consensus Estimate for earnings in the fiscal second quarter is $1.74 per share, reflecting a 4.4% decline from the prior year's figure [2]. - Revenue estimates for the same quarter are pegged at $54.97 billion, indicating a 4.3% year-over-year decline [2]. Group 2: Segment Performance - Cardinal Health began reporting results under new operating segments from the fiscal third quarter of 2024, which include Pharmaceutical and Specialty solutions, Global Medical Products and Distribution (GMPD), nuclear at-home, and OptiFreight [3]. - In the first quarter of fiscal 2025, Pharmaceutical revenues decreased by 5% year over year to $48 billion, primarily due to a contract expiration with OptumRx. Excluding this impact, sales rose by 16% year over year [4]. - The GMPD segment reported revenues of $3.1 billion, up 3% year over year, but profits decreased from $12 million to $8 million due to higher costs [6]. Group 3: Strategic Initiatives - In November 2024, Cardinal Health announced two strategic acquisitions: a majority stake in GI Alliance for approximately $2.8 billion and the Advanced Diabetes Supply Group for about $1.1 billion, aimed at enhancing specialty and at-home care services [8]. - The company opened a new 350,000-square-foot warehouse in South Carolina, which is expected to improve operational efficiency and drive growth [9]. Group 4: Earnings Prediction - The company's earnings prediction model indicates a potential earnings beat, supported by a positive Earnings ESP of +0.42% and a Zacks Rank of 2 [11][12].