Cardinal Health, Inc. (CAH) vs McKesson Corporation (MCK)

Cardinal Health, Inc. and McKesson Corporation are both Medical Distribution companies. McKesson Corporation is the larger, with a market value of $125.0B against $62.0B — 2.0× the size. McKesson Corporation trades at the lower P/E: 27.5× against 34.5×. Cardinal Health, Inc. grew revenue faster over the last twelve months: 10.0% against 8.19%. McKesson Corporation has the higher net margin (1.12% vs 0.71%) and the lower return on invested capital (114.2% vs 246.2%). Both pay a dividend; Cardinal Health, Inc. yields more (0.77% vs 0.32%). Across the 22 metrics below, McKesson Corporation leads on 12 and Cardinal Health, Inc. on 10.

Valuation

Metric CAH MCK Medical Distribution median
P/E 34.50 27.50 —
P/S 0.24 0.30 0.27
P/B n/m n/m —
Price to free cash flow 13.63 18.19 —
EV/EBITDA 17.90 17.70 17.33
EV/Sales 0.25 0.32 0.86
Earnings yield 2.90% 3.64% (13.85%)
Free cash flow yield 7.34% 5.50% (6.11%)

Profitability

Metric CAH MCK Medical Distribution median
Gross margin 3.90% 3.67% 5.74%
Operating margin 1.05% 1.60% 0.00%
Net margin 0.71% 1.12% (11.41%)
Free cash flow margin 0.00% 1.64% (0.36%)
Return on equity (64.96%) (190.51%) 0.00%
Return on assets 3.17% 5.33% (1.95%)
Return on invested capital 246.17% 114.15% 0.00%

Growth

Metric CAH MCK Medical Distribution median
Revenue growth (TTM) 10.00% 8.19% 6.15%
EPS growth (last fiscal year) 12.09% 49.22% 5.18%
Revenue growth, 5-year CAGR 9.37% 11.11% 8.18%
Net income growth, 5-year CAGR 22.91% 0.00% 0.00%

Health

Metric CAH MCK Medical Distribution median
Debt to equity (3.08) (3.85) (0.66)
Current ratio 0.88 0.90 0.99
Net debt to EBITDA 1.13 1.10 (0.10)

Dividend

Metric CAH MCK Medical Distribution median
Dividend yield 0.77% 0.32% —
Payout ratio 0.27 0.09 —

Size

Metric CAH MCK Medical Distribution median
Market cap 62.02b 124.98b 97.81m

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