Cardinal Beneish M Score

CAH
 Stock
  

USD 52.25  0.85  1.60%   

This module uses fundamental data of Cardinal Health to approximate the value of its Beneish M Score. Cardinal Health M Score tells investors if the company management is likely to be manipulating earnings. The score is calculated using eight financial indicators that are adjusted by a specific multiplier. Please note, the M Score is a probabilistic model and cannot detect companies that manipulate their earnings with 100% accuracy. Continue to Cardinal Health Piotroski F Score and Cardinal Health Altman Z Score analysis.
  
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Cardinal Health Long Term Debt to Equity is most likely to increase slightly in the upcoming years. The last year's value of Long Term Debt to Equity was reported at 2.70. The current Debt to Equity Ratio is estimated to increase to 29.55, while Debt Current is projected to decrease to roughly 873 M. Cardinal Health Inventory Turnover is most likely to slightly decrease in the upcoming years. The last year's value of Inventory Turnover was reported at 12.88. The current Accounts Payable Turnover is estimated to increase to 9.05, while Calculated Tax Rate is projected to decrease to (105.60) .
At this time, it appears that Cardinal Health is an unlikely manipulator. The earnings manipulation may begin if Cardinal Health's top management creates an artificial sense of financial success, forcing the stock price to be traded at a high price-earnings multiple than it should be. In general, excessive earnings management by Cardinal Health executives may lead to removing some of the operating profits from subsequent periods to inflate earnings in the following periods. This way, the manipulation of Cardinal Health's earnings can lead to misrepresentations of actual financial condition, taking the otherwise loyal stakeholders on to the path of questionable ethical practices and plain fraud.
-3.11
Beneish M Score - Unlikely Manipulator
Elasticity of Receivables1.02Focus
Asset QualityN/AFocus
Expense Coverage1.03Focus
Gross Margin Strengs1.08Focus
Accruals Factor1.03Focus
Depreciation Resistance0.98Focus
Net Sales Growth0.91Focus
Financial Leverage Condition0.97Focus

Cardinal Health Beneish M-Score Indicator Trends

The cure to earnings manipulation is the transparency of financial reporting. It will typically remove the temptation of the top executives to inflate earnings (i.e., to promote the idea of 'winning at any cost'). Because a healthy internal audit department can enhance transparency, the board should promote the auditors' access to all the record-keeping systems across the enterprise. For example, if Cardinal Health's auditors report directly to the board (not management), the managers will be reluctant to manipulate simply due to the fear of punishment. On the other hand, the auditors will be free to investigate the ledgers properly because they know that the board has their back.
Current ValueLast YearChange From Last Year 10 Year Trend
Revenues170.8 B186.8 B
Significantly Down
Increasing
Slightly volatile
Selling General and Administrative Expense4.9 B5.2 B
Notably Down
Increasing
Slightly volatile
Net Cash Flow from Operations2.7 B2.8 B
Fairly Down
Increasing
Slightly volatile
Depreciation Amortization and Accretion862.9 M900.5 M
Sufficiently Down
Increasing
Slightly volatile
Total Assets47 B51.1 B
Significantly Down
Increasing
Slightly volatile
Property Plant and Equipment Net2.5 B2.7 B
Notably Down
Increasing
Slightly volatile
Trade and Non Trade Receivables9.8 B10.5 B
Significantly Down
Increasing
Slightly volatile
Total Liabilities42.7 B49.1 B
Fairly Down
Increasing
Slightly volatile
Current Assets32.3 B35.7 B
Moderately Down
Increasing
Slightly volatile
Assets Non Current14.7 B15.4 B
Sufficiently Down
Increasing
Slightly volatile
Current Liabilities28.3 B31.8 B
Fairly Down
Increasing
Slightly volatile
Liabilities Non Current14.4 B17.3 B
Fairly Down
Increasing
Slightly volatile
Total Debt7.4 B7.2 B
Fairly Up
Increasing
Slightly volatile
Debt Current873 MB
Fairly Down
Increasing
Slightly volatile
Debt Non Current6.5 B6.2 B
Notably Up
Increasing
Slightly volatile
Operating Income669.1 M467.1 M
Way Up
Decreasing
Slightly volatile
Gross Margin0.04070.0378
Significantly Up
Decreasing
Slightly volatile

Cardinal Health Beneish M-Score Driver Matrix

One of the toughest challenges investors face today is learning how to quickly synthesize historical financial statements and information provided by the company, SEC reporting, and various external parties in order to detect the potential manipulation of earnings. Understanding the correlation between Cardinal Health's different financial indicators related to revenue, expenses, operating profit, and net earnings helps investors identify and prioritize their investing strategies towards Cardinal Health in a much-optimized way. Analyzing correlations between earnings drivers directly associated with dollar figures is the most effective way to find Cardinal Health's degree of accounting gimmicks and manipulations.

About Cardinal Health Beneish M Score

M-Score is one of many grading techniques for value stocks. It was developed by Professor M. Daniel Beneish of the Kelley School of Business at Indiana University and published in 1999 under the paper titled The Detection of Earnings Manipulation. The Beneish score is a multi-factor model that utilizes financial identifiers to compile eight variables used to classify whether a company has manipulated its reported earnings. The variables are built from the officially filed financial statements to create a final score call 'M Score.' The score helps to identify companies that are likely to manipulate their profits if they show deteriorating gross margins, operating expenses, and leverage against growing revenue.

Operating Expenses

6.74 Billion

Share
Cardinal Health Operating Expenses is most likely to increase significantly in the upcoming years. The last year's value of Operating Expenses was reported at 7.2 Billion

Cardinal Health Earnings Manipulation Drivers

Although earnings manipulation is typically not the result of intentional misconduct by the c-level executives, it is still a widespread practice by the senior management of public companies such as Cardinal Health. It is usually done by a series of misrepresentations of various accounting rules and operating activities across multiple financial cycles. The best way to spot the manipulation is to examine the historical financial statement to find inconsistencies in earning reports to find trends in assets or liabilities that are not sustainable in the future.
201720182019202020212022 (projected)
Revenues136.81 B145.53 B152.92 B162.47 B186.84 B170.79 B
Total Assets39.95 B40.96 B40.77 B44.45 B51.12 B46.97 B
Current Assets24.55 B25.75 B25.94 B31.05 B35.71 B32.26 B
Assets Non Current15.4 B15.22 B14.83 B13.4 B15.42 B14.72 B
Total Liabilities33.89 B34.63 B38.97 B42.66 B49.06 B42.75 B
Current Liabilities22.89 B24.11 B23.61 B27.62 B31.77 B28.32 B
Total Debt9.01 B8.03 B6.78 B6.24 B7.17 B7.38 B
Debt Current1 B452 M10 M871 M1 B873.05 M
Debt Non Current8.01 B7.58 B6.76 B5.37 B6.17 B6.5 B
Operating Income103 M2.04 B(4.1 B)519 M467.1 M669.08 M
Gross Margin0.050.0520.0470.0450.03780.0407

Cardinal Health ESG Sustainability

Some studies have found that companies with high sustainability scores are getting higher valuations than competitors with lower social-engagement activities. While most ESG disclosures are voluntary and do not directly affect the long term financial condition, Cardinal Health's sustainability indicators can be used to identify proper investment strategies using environmental, social, and governance scores that are crucial to Cardinal Health's managers, analysts, and investors.
Environment Score
Governance Score
Social Score

About Cardinal Health Fundamental Analysis

The Macroaxis Fundamental Analysis modules help investors analyze Cardinal Health's financials across various querterly and yearly statements, indicators and fundamental ratios. We help investors to determine the real value of Cardinal Health using virtually all public information available. We use both quantitative as well as qualitative analysis to arrive at the intrinsic value of Cardinal Health based on its fundamental data. In general, a quantitative approach, as applied to this company, focuses on analyzing financial statements comparatively, whereas a qaualitative method uses data that is important to a company's growth but cannot be measured and presented in a numerical way.
Please read more on our fundamental analysis page.
Cardinal Health, Inc. operates as an integrated healthcare services and products company in the United States, Canada, Europe, Asia, and internationally. Cardinal Health, Inc. was founded in 1979 and is headquartered in Dublin, Ohio. Cardinal Health operates under Medical Distribution classification in the United States and is traded on New York Stock Exchange. It employs 44000 people.

Cardinal Health Investors Sentiment

The influence of Cardinal Health's investor sentiment on the probability of its price appreciation or decline could be a good factor in your decision-making process regarding taking a position in Cardinal. The overall investor sentiment generally increases the direction of a stock movement in a one-year investment horizon. However, the impact of investor sentiment on the entire stock markets does not have a solid backing from leading economists and market statisticians.
Investor biases related to Cardinal Health's public news can be used to forecast risks associated with investment in Cardinal. The trend in average sentiment can be used to explain how an investor holding Cardinal can time the market purely based on public headlines and social activities around Cardinal Health. Please note that most equiteis that are difficult to arbitrage are affected by market sentiment the most.
Cardinal Health's market sentiment shows the aggregated news analyzed to detect positive and negative mentions from the text and comments. The data is normalized to provide daily scores for Cardinal Health's and other traded tickers. The bigger the bubble, the more accurate is the estimated score. Higher bars for a given day show more participation in the average Cardinal Health's news discussions. The higher the estimate score, the more favorable is the investor's outlook on Cardinal Health.

Cardinal Health Implied Volatility

    
  26.81  
Cardinal Health's implied volatility exposes the market's sentiment of Cardinal Health stock's possible movements over time. However, it does not forecast the overall direction of its price. In a nutshell, if Cardinal Health's implied volatility is high, the market thinks the stock has potential for high price swings in either direction. On the other hand, the low implied volatility suggests that Cardinal Health stock will not fluctuate a lot when Cardinal Health's options are near their expiration.
Some investors attempt to determine whether the market's mood is bullish or bearish by monitoring changes in market sentiment. Unlike more traditional methods such as technical analysis, investor sentiment usually refers to the aggregate attitude towards Cardinal Health in the overall investment community. So, suppose investors can accurately measure the market's sentiment. In that case, they can use it for their benefit. For example, some tools to gauge market sentiment could be utilized using contrarian indexes, Cardinal Health's short interest history, or implied volatility extrapolated from Cardinal Health options trading.

Current Sentiment - CAH

Cardinal Health Investor Sentiment

Greater number of Macroaxis users are currently bullish on Cardinal Health. What is your opinion about investing in Cardinal Health? Are you bullish or bearish?
Bullish
Bearish
98% Bullish
2% Bearish

Pair Trading with Cardinal Health

One of the main advantages of trading using pair correlations is that every trade hedges away some risk. Because there are two separate transactions required, even if Cardinal Health position performs unexpectedly, the other equity can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in Cardinal Health will appreciate offsetting losses from the drop in the long position's value.

Cardinal Health Pair Correlation

Correlation Analysis For Direct Indexing and Tax-loss Harvesting

The ability to find closely correlated positions to Cardinal Health could be a great tool in your tax-loss harvesting strategies, allowing investors a quick way to find a similar-enough asset to replace Cardinal Health when you sell it. If you don't do this, your portfolio allocation will be skewed against your target asset allocation. So, investors can't just sell and buy back Cardinal Health - that would be a violation of the tax code under the "wash sale" rule, and this is why you need to find a similar enough asset and use the proceeds from selling Cardinal Health to buy it.
The correlation of Cardinal Health is a statistical measure of how it moves in relation to other equities. This measure is expressed in what is known as the correlation coefficient, which ranges between -1 and +1. A perfect positive correlation (i.e., a correlation coefficient of +1) implies that as Cardinal Health moves, either up or down, the other security will move in the same direction. Alternatively, perfect negative correlation means that if Cardinal Health moves in either direction, the perfectly negatively correlated security will move in the opposite direction. If the correlation is 0, the equities are not correlated; they are entirely random. A correlation greater than 0.8 is generally described as strong, whereas a correlation less than 0.5 is generally considered weak.
Correlation analysis and pair trading evaluation for Cardinal Health can also be used as hedging techniques within a particular sector or industry or even over random equities to generate a better risk-adjusted return on your portfolios.
Pair CorrelationCorrelation Matching
Continue to Cardinal Health Piotroski F Score and Cardinal Health Altman Z Score analysis. Note that the Cardinal Health information on this page should be used as a complementary analysis to other Cardinal Health's statistical models used to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try Content Syndication module to quickly integrate customizable finance content to your own investment portal.

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When running Cardinal Health price analysis, check to measure Cardinal Health's market volatility, profitability, liquidity, solvency, efficiency, growth potential, financial leverage, and other vital indicators. We have many different tools that can be utilized to determine how healthy Cardinal Health is operating at the current time. Most of Cardinal Health's value examination focuses on studying past and present price action to predict the probability of Cardinal Health's future price movements. You can analyze the entity against its peers and financial market as a whole to determine factors that move Cardinal Health's price. Additionally, you may evaluate how the addition of Cardinal Health to your portfolios can decrease your overall portfolio volatility.
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Is Cardinal Health's industry expected to grow? Or is there an opportunity to expand the business' product line in the future? Factors like these will boost the valuation of Cardinal Health. If investors know Cardinal will grow in the future, the company's valuation will be higher. The financial industry is built on trying to define current growth potential and future valuation accurately. All the valuation information about Cardinal Health listed above have to be considered, but the key to understanding future value is determining which factors weigh more heavily than others.
Quarterly Earnings Growth YOY
-0.92
Market Capitalization
14.5 B
Quarterly Revenue Growth YOY
0.14
Return On Assets
0.0253
Return On Equity
-1.73
The market value of Cardinal Health is measured differently than its book value, which is the value of Cardinal that is recorded on the company's balance sheet. Investors also form their own opinion of Cardinal Health's value that differs from its market value or its book value, called intrinsic value, which is Cardinal Health's true underlying value. Investors use various methods to calculate intrinsic value and buy a stock when its market value falls below its intrinsic value. Because Cardinal Health's market value can be influenced by many factors that don't directly affect Cardinal Health's underlying business (such as a pandemic or basic market pessimism), market value can vary widely from intrinsic value.
Please note, there is a significant difference between Cardinal Health's value and its price as these two are different measures arrived at by different means. Investors typically determine Cardinal Health value by looking at such factors as earnings, sales, fundamental and technical indicators, competition as well as analyst projections. However, Cardinal Health's price is the amount at which it trades on the open market and represents the number that a seller and buyer find agreeable to each party.