Cardinal (CAH) Upgraded to Buy: Here's Why

Core Viewpoint - Cardinal Health (CAH) has received an upgrade to a Zacks Rank 2 (Buy), indicating a positive outlook on its earnings estimates, which is a significant factor influencing stock prices [1][3]. Earnings Estimates and Stock Price Impact - The Zacks rating system reflects changes in earnings estimates, which are strongly correlated with near-term stock price movements, particularly due to institutional investors adjusting their valuations based on these estimates [4][6]. - An increase in earnings estimates typically leads to higher fair value for a stock, prompting institutional investors to buy or sell, thus affecting stock prices [4]. Cardinal Health's Earnings Outlook - For the fiscal year ending June 2025, Cardinal Health is expected to earn $8.09 per share, representing a 7.4% increase from the previous year [8]. - Over the past three months, the Zacks Consensus Estimate for Cardinal has risen by 2.3%, indicating a positive trend in earnings expectations [8]. Zacks Rank System - The Zacks Rank system classifies stocks into five groups based on earnings estimates, with Zacks Rank 1 (Strong Buy) stocks historically generating an average annual return of +25% since 1988 [7]. - Cardinal's upgrade to Zacks Rank 2 places it in the top 20% of Zacks-covered stocks, suggesting a strong potential for market-beating returns in the near term [10].