McKesson Corporation

DB:MCK Stock Report

Market Cap: €75.1b

McKesson Valuation

Is MCK undervalued compared to its fair value, analyst forecasts and its price relative to the market?

Valuation Score

3/6

Valuation Score 3/6

  • Below Fair Value

  • Significantly Below Fair Value

  • Price-To-Earnings vs Peers

  • Price-To-Earnings vs Industry

  • Price-To-Earnings vs Fair Ratio

  • Analyst Forecast

Share Price vs Fair Value

What is the Fair Price of MCK when looking at its future cash flows? For this estimate we use a Discounted Cash Flow model.

Below Fair Value: MCK (€594.4) is trading below our estimate of fair value (€1547.29)

Significantly Below Fair Value: MCK is trading below fair value by more than 20%.

Key Valuation Metric

Which metric is best to use when looking at relative valuation for MCK?

Key metric: As MCK is profitable we use its Price-To-Earnings Ratio for relative valuation analysis.

The above table shows the Price to Earnings ratio for MCK. This is calculated by dividing MCK's market cap by their current earnings.
What is MCK's PE Ratio?
PE Ratio31.4x
EarningsUS$2.54b
Market CapUS$79.34b

Price to Earnings Ratio vs Peers

How does MCK's PE Ratio compare to its peers?

The above table shows the PE ratio for MCK vs its peers. Here we also display the market cap and forecasted growth for additional consideration.
CompanyForward PEEstimated GrowthMarket Cap
Peer Average26.4x
SHL Siemens Healthineers
29.4x14.2%€57.1b
ILM1 Medios
25.2x43.9%€324.0m
FME Fresenius Medical Care
18.9x19.3%€12.5b
COR Cencora
32x14.6%US$48.0b
MCK McKesson
31.4x15.0%€79.3b

Price-To-Earnings vs Peers: MCK is expensive based on its Price-To-Earnings Ratio (31.4x) compared to the peer average (26.4x).

Price to Earnings Ratio vs Industry

How does MCK's PE Ratio compare vs other companies in the European Healthcare Industry?

2 CompaniesPrice / EarningsEstimated GrowthMarket Cap
MCK 31.4xIndustry Avg. 18.8xNo. of Companies9PE01020304050+
2 CompaniesEstimated GrowthMarket Cap
No more companies

Price-To-Earnings vs Industry: MCK is expensive based on its Price-To-Earnings Ratio (31.4x) compared to the European Healthcare industry average (18.5x).

Price to Earnings Ratio vs Fair Ratio

What is MCK's PE Ratio compared to its Fair PE Ratio? This is the expected PE Ratio taking into account the company's forecast earnings growth, profit margins and other risk factors.

MCK PE Ratio vs Fair Ratio.
Fair Ratio
Current PE Ratio31.4x
Fair PE Ratio34.2x

Price-To-Earnings vs Fair Ratio: MCK is good value based on its Price-To-Earnings Ratio (31.4x) compared to the estimated Fair Price-To-Earnings Ratio (34.2x).

Analyst Price Targets

What is the analyst 12-month forecast and do we have any statistical confidence in the consensus price target?

The above table shows the analyst MCK forecast and predictions for the stock price in 12 month’s time.
DateShare PriceAverage 1Y Price TargetDispersionHighLow1Y Actual priceAnalysts
Current€594.40
€611.05
+2.8%
10.4%€681.25€504.98n/a16
Nov ’25€482.00
€534.07
+10.8%
9.0%€604.48€448.11n/a16
Oct ’25€442.60
€543.84
+22.9%
8.4%€602.00€440.27n/a16
Sep ’25€501.20
€559.12
+11.6%
7.5%€601.15€438.99n/a16
Aug ’25€581.00
€569.95
-1.9%
10.5%€643.02€422.56n/a16
Jul ’25€544.00
€559.76
+2.9%
9.0%€633.57€429.23n/a16
Jun ’25€516.40
€545.83
+5.7%
8.7%€628.69€425.91n/a16
May ’25€500.00
€526.64
+5.3%
9.2%€580.82€384.09n/a17
Apr ’25€498.00
€500.00
+0.4%
8.6%€566.31€374.49n/a17
Mar ’25€481.00
€499.51
+3.8%
8.1%€552.96€377.86n/a17
Feb ’25€452.00
€471.60
+4.3%
8.3%€520.74€369.32n/a16
Jan ’25€412.00
€458.45
+11.3%
7.9%€516.44€366.92n/a14
Dec ’24€436.00
€449.38
+3.1%
7.2%€484.31€365.52n/a13
Nov ’24€430.00
€454.79
+5.8%
7.5%€496.07€373.24€482.0013
Oct ’24€417.00
€443.83
+6.4%
6.4%€477.31€369.68€442.6013
Sep ’24€382.00
€435.96
+14.1%
6.2%€468.08€362.53€501.2014
Aug ’24€367.00
€408.71
+11.4%
7.2%€453.55€340.16€581.0014
Jul ’24€392.00
€406.94
+3.8%
7.7%€458.20€343.65€544.0015
Jun ’24€365.00
€400.99
+9.9%
8.3%€452.41€320.65€516.4015
May ’24€329.00
€382.24
+16.2%
6.8%€412.91€315.81€500.0015
Apr ’24€330.30
€388.64
+17.7%
6.4%€414.86€320.82€498.0015
Mar ’24€328.70
€386.38
+17.5%
6.6%€412.34€318.87€481.0014
Feb ’24€345.45
€388.30
+12.4%
6.8%€423.15€320.13€452.0014
Jan ’24€350.90
€392.40
+11.8%
6.4%€423.27€327.33€412.0014
Dec ’23€363.25
€403.64
+11.1%
7.2%€435.83€325.42€436.0013
Nov ’23€388.20
€394.60
+1.6%
8.4%€432.60€304.76€430.0013

Analyst Forecast: Target price is less than 20% higher than the current share price.

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