Cardinal Health, Inc. (NYSE:CAH) Just Released Its Second-Quarter Earnings: Here's What Analysts Think

Cardinal Health, Inc. (NYSE:CAH) shareholders are probably feeling a little disappointed, since its shares fell 2.1% to US$103 in the week after its latest second-quarter results. Cardinal Health reported in line with analyst predictions, delivering revenues of US$57b and statutory earnings per share of US$1.43, suggesting the business is executing well and in line with its plan. This is an important time for investors, as they can track a company's performance in its report, look at what experts are forecasting for next year, and see if there has been any change to expectations for the business. So we gathered the latest post-earnings forecasts to see what estimates suggest is in store for next year.

Check out our latest analysis for Cardinal Health

Taking into account the latest results, the current consensus from Cardinal Health's 14 analysts is for revenues of US$226.8b in 2024. This would reflect a modest 4.9% increase on its revenue over the past 12 months. Per-share earnings are expected to soar 124% to US$5.88. In the lead-up to this report, the analysts had been modelling revenues of US$226.0b and earnings per share (EPS) of US$5.70 in 2024. So the consensus seems to have become somewhat more optimistic on Cardinal Health's earnings potential following these results.

There's been no major changes to the consensus price target of US$111, suggesting that the improved earnings per share outlook is not enough to have a long-term positive impact on the stock's valuation. That's not the only conclusion we can draw from this data however, as some investors also like to consider the spread in estimates when evaluating analyst price targets. There are some variant perceptions on Cardinal Health, with the most bullish analyst valuing it at US$133 and the most bearish at US$93.00 per share. These price targets show that analysts do have some differing views on the business, but the estimates do not vary enough to suggest to us that some are betting on wild success or utter failure.

Of course, another way to look at these forecasts is to place them into context against the industry itself. The period to the end of 2024 brings more of the same, according to the analysts, with revenue forecast to display 10% growth on an annualised basis. That is in line with its 8.6% annual growth over the past five years. Compare this with the broader industry, which analyst estimates (in aggregate) suggest will see revenues grow 6.5% annually. So although Cardinal Health is expected to maintain its revenue growth rate, it's definitely expected to grow faster than the wider industry.

The Bottom Line

The biggest takeaway for us is the consensus earnings per share upgrade, which suggests a clear improvement in sentiment around Cardinal Health's earnings potential next year. Fortunately, they also reconfirmed their revenue numbers, suggesting that it's tracking in line with expectations. Additionally, our data suggests that revenue is expected to grow faster than the wider industry. There was no real change to the consensus price target, suggesting that the intrinsic value of the business has not undergone any major changes with the latest estimates.

With that said, the long-term trajectory of the company's earnings is a lot more important than next year. At Simply Wall St, we have a full range of analyst estimates for Cardinal Health going out to 2026, and you can see them free on our platform here..

We don't want to rain on the parade too much, but we did also find 3 warning signs for Cardinal Health that you need to be mindful of.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.