McKesson (MCK) Gets Higher Target at Deutsche Bank Despite Planned Spin-Off

Core Insights - McKesson Corporation (NYSE:MCK) is recognized as one of the 14 Best Pharma Dividend Stocks to Buy in 2026 [1] - Deutsche Bank analyst George Hill raised McKesson's price target to $904 from $861 while maintaining a Buy rating, despite the company's planned spin-off of its med-surgical business [2] - McKesson has increased its fiscal 2026 profit forecast, expecting adjusted earnings per share between $38.35 and $38.85, up from a previous range of $38.05 to $38.55 [2] - The company reported adjusted earnings of $9.86 per share for the most recent quarter, exceeding estimates of $9.02, while revenue was $103.15 billion, slightly below expectations [3] - McKesson's US pharmaceutical unit generated sales of $86.5 billion, an 8% increase year-over-year, although it fell short of the $87.40 billion consensus forecast [3] - The company plans to reorganize into four operating segments to focus on higher-margin areas, particularly in cancer medicines [4] Financial Performance - McKesson's adjusted earnings per share for fiscal 2026 are projected to be between $38.35 and $38.85, which is an increase from the previous forecast [2] - The latest quarter's adjusted earnings were $9.86 per share, surpassing the expected $9.02 [3] - Revenue for the most recent quarter was reported at $103.15 billion, slightly below the anticipated $104.13 billion [3] Strategic Initiatives - McKesson is planning to exit its med-surgical business through an IPO and subsequent spin-off, expected to be completed by the end of 2027 [2] - The company aims to reorganize into four operating segments to enhance focus on higher-margin products, particularly in oncology [4]