McKesson Shares Surge to Record High Following Strong Earnings Report

McKesson Corporation (NYSE: MCK) achieved a significant milestone on Thursday, reaching a new 52-week high in its stock price, buoyed by an impressive earnings report. During mid-day trading, shares climbed to a peak of $964.94 before settling at $958.92, representing a sharp increase from the previous close of $822.00. Total trading volume reached 586,810 shares.

The company’s latest quarterly results revealed earnings of $9.34 per share (EPS), surpassing analysts’ expectations that had set the consensus at $9.19 by a margin of $0.15. Additionally, McKesson reported quarterly revenue of $106.16 billion, which also exceeded estimates of $105.98 billion. This marked an 11.4% increase compared to the same period last year, when the company reported an EPS of $8.03.

Dividend Announcement and Future Guidance

In conjunction with the earnings announcement, McKesson declared a quarterly dividend of $0.82 per share, set to be paid on April 1, 2024. Shareholders of record as of March 2, 2024 will be eligible for this dividend, which results in an annualized payout of $3.28 and a dividend yield of 0.3%. The company’s dividend payout ratio currently stands at 9.43%.

Looking ahead, McKesson has set its fiscal year 2026 guidance for EPS between $38.800 and $39.200.

Analyst Ratings and Market Performance

McKesson’s strong performance has not gone unnoticed by Wall Street analysts. Recent reports indicate that Jefferies Financial Group has raised its price target for the stock from $820.00 to $900.00, maintaining a “buy” rating. Similarly, Mizuho upped their target from $880.00 to $885.00 with a “neutral” rating.

UBS Group has further increased its target for McKesson from $920.00 to $980.00, also assigning a “buy” rating. Meanwhile, Wells Fargo & Company raised its price objective from $914.00 to $925.00, giving the stock an “equal weight” rating. Currently, one equity research analyst rates the stock as a Strong Buy, twelve analysts have issued Buy ratings, and four have given it a Hold rating. The consensus rating across analysts is categorized as “Moderate Buy,” with an average price target of $918.93.

In terms of market metrics, McKesson boasts a market capitalization of $116.12 billion and a price-to-earnings ratio of 27.26. The stock has a 50-day moving average price of $828.41 and a 200-day moving average price of $779.58.

Insider Transactions and Institutional Holdings

In related news, Executive Vice President Thomas L. Rodgers sold 276 shares of McKesson stock on January 5, 2024, at an average price of $816.18, amounting to a total value of approximately $225,265.68. Following this transaction, Rodgers retains 2,268 shares in the company, valued at around $1,851,096.24. This sale represents a 10.85% reduction in his ownership.

On the institutional side, significant activity has been observed as various funds have adjusted their stakes in McKesson. GGM Financials LLC acquired a new position worth $25,000 in the third quarter, while Solstein Capital LLC increased its stake by 171.4% during the second quarter. The company’s institutional ownership currently stands at 85.07%.

McKesson Corporation, founded in 1833 and headquartered in Irving, Texas, operates as a global healthcare services and distribution company, supplying pharmaceuticals, medical-surgical products, and healthcare technology solutions. The firm plays a vital role in connecting manufacturers, pharmacies, hospitals, and health systems, facilitating the distribution of medicines and clinical supplies.