Cardinal Health Profitability Analysis

CAH
 Stock
  

USD 69.32  3.32  5.03%   

For Cardinal Health profitability analysis, we use financial ratios and fundamental drivers that measure the ability of Cardinal Health to generate income relative to revenue, assets, operating costs, and current equity. These fundamental indicators attest to how well Cardinal Health utilizes its assets to generate profit and value for its shareholders. The profitability module also shows relationships between Cardinal Health's most relevant fundamental drivers. It provides multiple suggestions of what could affect the performance of Cardinal Health over time as well as its relative position and ranking within its peers. Continue to Trending Equities.
  
The current Price to Sales Ratio is estimated to increase to 0.11, while Return on Sales is projected to decrease to (0.003079) . Cardinal Health Net Income Per Employee is most likely to decrease significantly in the upcoming years. The last year's value of Net Income Per Employee was reported at 14,855.7.

Cardinal Health Revenues

170.87 Billion

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
0.25
Market Capitalization
18.9 B
Quarterly Revenue Growth YOY
0.11
Return On Assets
0.0236
Return On Equity
-1.71
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.

Cardinal Health Book Value Per Share vs. Price to Sales Fundamental Analysis

Comparative valuation techniques use various fundamental indicators to help in determining Cardinal Health's current stock value. Our valuation model uses many indicators to compare Cardinal Health value to that of its competitors to determine the firm's financial worth.
Cardinal Health is number one stock in price to sales category among related companies. It is number one stock in book value per share category among related companies . Cardinal Health Book Value per Share is most likely to decrease significantly in the upcoming years. The last year's value of Book Value per Share was reported at -2.54. Comparative valuation analysis is a catch-all model that can be used if you cannot value Cardinal Health by discounting back its dividends or cash flows. This model doesn't attempt to find an intrinsic value for Cardinal Health's Stock . Still, instead, it compares the stock's price multiples to a benchmark or nearest competition to determine if the stock is relatively undervalued or overvalued. The reason why the comparable model can be used in almost all circumstances is due to the vast number of multiples that can be utilized, such as the price-to-earnings (P/E), price-to-book (P/B), price-to-sales (P/S), price-to-cash flow (P/CF), and many others. The P/E ratio is the most commonly used of these ratios because it focuses on the Cardinal Health's earnings, one of the primary drivers of an investment's value.

Cardinal Book Value Per Share vs. Price to Sales

Price to Sales ratio is typically used for valuing equity relative to its own past performance as well as to performance of other companies or market indexes. In most cases, the lower the ratio, the better it is for investors. However, it is advisable for investors to exercise caution when looking at price-to-sales ratios across different industries.
Cardinal Health 
P/S 
 = 
MV Per Share 
Revenue Per Share 
0.10 X
The most critical factor to remember is that the price of equity takes a firm's debt into account, whereas the sales indicators do not consider financial leverage. Generally speaking, Price to Sales ratio shows how much market values every dollar of the company's sales.
Book Value per Share (B/S) can be calculated by subtracting liabilities from assets, and then dividing it by the total number of currently outstanding shares. It indicates the level of safety associated with each common share after removing the effects of liabilities. In other words, a shareholder can use this ratio to see how much he or she can sell the stake in the company in the event of a liquidation.
Cardinal Health 
Book Value per Share 
 = 
Common Equity 
Average Shares 
(2.59) X
The naive approach to look at Book Value per Share is to compare it to current stock price. If Book Value per Share is higher than the currently traded stock price, the company can be considered undervalued. However, investors must be aware that conventional calculation of Book Value does not include intangible assets such as goodwill, intellectual property, trademarks or brands and may not be an appropriate measure for many firms.

Cardinal Book Value Per Share Comparison

Cardinal Health is currently under evaluation in book value per share category among related companies.

Cardinal Health Profitability Projections

The most important aspect of a successful company is its ability to generate a profit. For investors in Cardinal Health, profitability is also one of the essential criteria for including it into their portfolios because, without profit, Cardinal Health will eventually generate negative long term returns. The profitability progress is the general direction of Cardinal Health's change in net profit over the period of time. It can combine multiple indicators of Cardinal Health, where stable trends show no significant progress. An accelerating trend is seen as positive, while a decreasing one is unfavorable. A rising trend means that profits are rising, and operational efficiency may be rising as well. A decreasing trend is a sign of poor performance and may indicate upcoming losses.
Last ReportedProjected for 2022
Accumulated Other Comprehensive Income-114 M-117 M
Consolidated Income-932 M-956.5 M
Net Income-933 M-957.6 M
Net Income Common Stock-933 M-957.6 M
Net Loss Income from Discontinued Operations-2.7 M-2.8 M
Net Income to Non Controlling Interests900 K923.7 K
Operating Income-612 M-628.1 M
Income Tax Expense163 M228.9 M
Net Income Per Employee14.9 K15.3 K
Cardinal Health, Inc. operates as an integrated healthcare services and products company in the United States, Canada, Europe, Asia, and internationally. The company was incorporated 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.

Cardinal Profitability Driver Comparison

Profitability drivers are factors that can directly affect your investment outlook on Cardinal Health. Investors often realize that things won't turn out the way they predict. There are maybe way too many unforeseen events and contingencies during the holding period of Cardinal Health position where the market behavior may be hard to predict, tax policy changes, gold or oil price hikes, calamities change, and many others. The question is, are you prepared for these unexpected events? Although some of these situations are obviously beyond your control, you can still follow the important profit indicators to know where you should focus on when things like this occur. Below are some of the Cardinal Health's important profitability drivers and their relationship over time.

Cardinal Health Profitability Trends

Cardinal Health profitability trend refers to the progression of profit or loss within a business. An upward trend means that Cardinal Health's profit has generally increased over time, and a downward profitability trend means profits are declining. Recognizing problems early in profitability trends allows investors to address revenue and cost issues in advance. Investors and analysts usually monitor three types of profitability trends: gross, operating, and net. Gross profit is the difference between revenue and costs of goods sold. Operating profit is Cardinal Health's gross profit minus its overhead. After you account for other unusual revenue, expenses, and costs, you get net profit. Gross profit trends are often a good indicator of future profitability. If you have high gross profit margins, you have a better chance to cover overhead and make money.

Cardinal Health Profitability Drivers Correlations

One of the toughest challenges investors face today is learning how to quickly synthesize and read into endless financial statements and information provided by the company, SEC reporting, and various external parties. Understanding the correlation between Cardinal Health different financial indicators related to revenue and profit generation helps investors identify and prioritize their investing strategies towards Cardinal Health in a much-optimized way. Analyzing correlations between profit drivers that are directly associated with dollar figures is the most effective way to break down Cardinal Health's future profitability.

Use Cardinal Health in pair-trading

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 Trading

Cardinal Health Pair Trading Analysis

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

Use Investing Themes to Complement your Cardinal Health position

In addition to having Cardinal Health in your portfolios, you can quickly add positions using our predefined set of ideas and optimize them against your very unique investing style. A single investing idea is a collection of funds, stocks, ETFs, or cryptocurrencies that are programmatically selected from a pull of investment themes. After you determine your investment opportunity, you can then find an optimal portfolio that will maximize potential returns on the chosen idea or minimize its exposure to market volatility.

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Defense
Defense Theme
Fama and French investing themes focus on testing asset pricing under different economic assumptions. The Defense theme has 10 constituents at this time.
You can either use a buy-and-hold strategy to lock in the entire theme or actively trade it to take advantage of the short-term price volatility of individual constituents. Macroaxis can help you discover thousands of investment opportunities in different asset classes. In addition, you can partner with us for reliable portfolio optimization as you plan to utilize Defense Theme or any other thematic opportunities.
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Continue to Trending Equities. 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 Balance Of Power module to check stock momentum by analyzing Balance Of Power indicator and other technical ratios.

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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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To fully project Cardinal Health's future profitability, investors should examine all historical financial statements. These statements provide investors with a comprehensive snapshot of the financial position of Cardinal Health at a specified time, usually calculated after every quarter, six months, or one year. Three primary documents fall into the category of financial statements. These documents include Cardinal Health's income statement, its balance sheet, and the statement of cash flows.
Potential Cardinal Health investors and stakeholders can use historical trends found within financial statements to determine how well the company is positioned for the future. Although Cardinal Health investors may work on each financial statement separately, they are all related. The changes in Cardinal Health's assets and liabilities, for example, are also reflected in the revenues and expenses that we see on Cardinal Health's income statement, which results in the company's gains or losses. Cash flows can provide more information regarding cash listed on a balance sheet but not equivalent to net income shown on the income statement. Please read more on our technical analysis and fundamental analysis pages.