McKesson Corporation

LSE:0JZU Stock Report

Market Cap: US$79.5b

McKesson Valuation

Is 0JZU 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 0JZU when looking at its future cash flows? For this estimate we use a Discounted Cash Flow model.

Below Fair Value: 0JZU ($626.71) is trading below our estimate of fair value ($1534.4)

Significantly Below Fair Value: 0JZU is trading below fair value by more than 20%.

Key Valuation Metric

Which metric is best to use when looking at relative valuation for 0JZU?

Key metric: As 0JZU is profitable we use its Price-To-Earnings Ratio for relative valuation analysis.

The above table shows the Price to Earnings ratio for 0JZU. This is calculated by dividing 0JZU's market cap by their current earnings.
What is 0JZU's PE Ratio?
PE Ratio31.4x
EarningsUS$2.54b
Market CapUS$79.51b

Price to Earnings Ratio vs Peers

How does 0JZU's PE Ratio compare to its peers?

The above table shows the PE ratio for 0JZU vs its peers. Here we also display the market cap and forecasted growth for additional consideration.
CompanyForward PEEstimated GrowthMarket Cap
Peer Average28.3x
SN. Smith & Nephew
36.1x22.5%UK£8.7b
COR Cencora
32x14.6%US$48.0b
MDC Mediclinic International
21.9x10.7%UK£3.7b
CAH Cardinal Health
23.2x7.7%US$29.6b
0JZU McKesson
31.4x15.0%US$79.5b

Price-To-Earnings vs Peers: 0JZU is expensive based on its Price-To-Earnings Ratio (31.4x) compared to the peer average (30.4x).

Price to Earnings Ratio vs Industry

How does 0JZU's PE Ratio compare vs other companies in the European Healthcare Industry?

2 CompaniesPrice / EarningsEstimated GrowthMarket Cap
0JZU 31.4xIndustry Avg. 18.8xNo. of Companies9PE01020304050+
2 CompaniesEstimated GrowthMarket Cap
No more companies

Price-To-Earnings vs Industry: 0JZU is expensive based on its Price-To-Earnings Ratio (31.4x) compared to the European Healthcare industry average (18.8x).

Price to Earnings Ratio vs Fair Ratio

What is 0JZU'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.

0JZU PE Ratio vs Fair Ratio.
Fair Ratio
Current PE Ratio31.4x
Fair PE Ratio47x

Price-To-Earnings vs Fair Ratio: 0JZU is good value based on its Price-To-Earnings Ratio (31.4x) compared to the estimated Fair Price-To-Earnings Ratio (47x).

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 0JZU forecast and predictions for the stock price in 12 month’s time.
DateShare PriceAverage 1Y Price TargetDispersionHighLow1Y Actual priceAnalysts
CurrentUS$626.71
US$641.33
+2.3%
10.4%US$715.00US$530.00n/a16
Nov ’25US$526.98
US$584.00
+10.8%
9.0%US$661.00US$490.00n/a16
Oct ’25US$497.00
US$605.28
+21.8%
8.4%US$670.00US$490.00n/a16
Sep ’25US$558.05
US$624.09
+11.8%
7.5%US$671.00US$490.00n/a16
Aug ’25US$628.23
US$620.45
-1.2%
10.5%US$700.00US$460.00n/a16
Jul ’25US$584.60
US$599.89
+2.6%
9.0%US$679.00US$460.00n/a16
Jun ’25US$562.20
US$589.51
+4.9%
8.7%US$679.00US$460.00n/a16
May ’25US$531.02
US$562.17
+5.9%
9.2%US$620.00US$410.00n/a17
Apr ’25US$537.77
US$547.41
+1.8%
8.6%US$620.00US$410.00n/a17
Mar ’25US$524.38
US$542.00
+3.4%
8.1%US$600.00US$410.00n/a17
Feb ’25US$499.09
US$510.77
+2.3%
8.3%US$564.00US$400.00n/a16
Jan ’25US$461.62
US$499.79
+8.3%
7.9%US$563.00US$400.00n/a14
Dec ’24US$468.88
US$491.77
+4.9%
7.2%US$530.00US$400.00n/a13
Nov ’24US$464.54
US$481.31
+3.6%
7.5%US$525.00US$395.00US$526.9813
Oct ’24US$435.00
US$474.23
+9.0%
6.4%US$510.00US$395.00US$497.0013
Sep ’24US$412.22
US$475.00
+15.2%
6.2%US$510.00US$395.00US$558.0514
Aug ’24US$403.15
US$450.56
+11.8%
7.2%US$500.00US$375.00US$628.2314
Jul ’24US$427.39
US$444.06
+3.9%
7.7%US$500.00US$375.00US$584.6015
Jun ’24US$389.20
US$435.20
+11.8%
8.3%US$491.00US$348.00US$562.2015
May ’24US$362.61
US$421.20
+16.2%
6.8%US$455.00US$348.00US$531.0215
Apr ’24US$358.63
US$421.57
+17.5%
6.4%US$450.00US$348.00US$537.7715
Mar ’24US$350.35
US$421.68
+20.4%
6.6%US$450.00US$348.00US$524.3814
Feb ’24US$374.46
US$422.11
+12.7%
6.8%US$460.00US$348.00US$499.0914
Jan ’24US$373.67
US$417.18
+11.6%
6.4%US$450.00US$348.00US$461.6214
Dec ’23US$383.53
US$416.77
+8.7%
7.2%US$450.00US$336.00US$468.8813
Nov ’23US$383.66
US$385.85
+0.6%
8.4%US$423.00US$298.00US$464.5413

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

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