NYSE:CAH, a growth stock which is not overvalued.

Last update: Apr 2, 2024

Our stock screener has singled out CARDINAL HEALTH INC (NYSE:CAH) as an attractive growth opportunity. NYSE:CAH is demonstrating remarkable growth potential while maintaining strong financial indicators, making it a reasonably priced option. We'll explore this further.

Growth Analysis for NYSE:CAH

ChartMill employs its own Growth Rating system for all stocks. This score, ranging from 0 to 10, is derived by evaluating different growth factors, such as EPS and revenue growth, taking into account both past performance and future projections. NYSE:CAH has earned a 7 for growth:

CAH shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 36.25%, which is quite impressive.
The Revenue has grown by 11.99% in the past year. This is quite good.
Measured over the past years, CAH shows a quite strong growth in Revenue. The Revenue has been growing by 8.43% on average per year.
The Earnings Per Share is expected to grow by 8.81% on average over the next years. This is quite good.
Based on estimates for the next years, CAH will show a quite strong growth in Revenue. The Revenue will grow by 8.11% on average per year.
The EPS growth rate is accelerating: in the next years the growth will be better than in the last years.

Analyzing Valuation Metrics

An integral part of ChartMill's stock analysis is the Valuation Rating, which spans from 0 to 10. This rating evaluates diverse valuation factors, including price to earnings and cash flows, while considering the stock's profitability and growth. NYSE:CAH has received a 7 out of 10:

83.62% of the companies in the same industry are more expensive than CAH, based on the Price/Earnings ratio.
CAH's Price/Earnings ratio indicates a valuation a bit cheaper than the S&P500 average which is at 26.31.
CAH's Price/Forward Earnings ratio is rather cheap when compared to the industry. CAH is cheaper than 87.07% of the companies in the same industry.
CAH is valuated rather cheaply when we compare the Price/Forward Earnings ratio to 22.62, which is the current average of the S&P500 Index.
CAH's Enterprise Value to EBITDA ratio is a bit cheaper when compared to the industry. CAH is cheaper than 78.45% of the companies in the same industry.
Compared to the rest of the industry, the Price/Free Cash Flow ratio of CAH indicates a rather cheap valuation: CAH is cheaper than 90.52% of the companies listed in the same industry.
The low PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a rather cheap valuation of the company.
A more expensive valuation may be justified as CAH's earnings are expected to grow with 14.99% in the coming years.

What does the Health looks like for NYSE:CAH

ChartMill assigns a Health Rating to every stock. This score ranges from 0 to 10 and evaluates the different health aspects like liquidity and solvency, both absolutely, but also relative to the industry peers. NYSE:CAH scores a 5 out of 10:

CAH has an Altman-Z score of 5.08. This indicates that CAH is financially healthy and has little risk of bankruptcy at the moment.
CAH has a Altman-Z score of 5.08. This is amongst the best in the industry. CAH outperforms 88.79% of its industry peers.
The Debt to FCF ratio of CAH is 1.38, which is an excellent value as it means it would take CAH, only 1.38 years of fcf income to pay off all of its debts.
CAH's Debt to FCF ratio of 1.38 is amongst the best of the industry. CAH outperforms 87.93% of its industry peers.

Analyzing Profitability Metrics

ChartMill's Profitability Rating offers a unique perspective on stock analysis, providing scores from 0 to 10. These ratings consider a wide range of profitability metrics and margins, both in comparison to industry peers and on their own merits. For NYSE:CAH, the assigned 5 is a significant indicator of profitability:

With a decent Return On Assets value of 1.37%, CAH is doing good in the industry, outperforming 62.93% of the companies in the same industry.
With an excellent Return On Invested Capital value of 19.39%, CAH belongs to the best of the industry, outperforming 97.41% of the companies in the same industry.
Measured over the past 3 years, the Average Return On Invested Capital for CAH is above the industry average of 8.67%.
The 3 year average ROIC (10.97%) for CAH is below the current ROIC(19.39%), indicating increased profibility in the last year.
Looking at the Profit Margin, with a value of 0.30%, CAH is in the better half of the industry, outperforming 61.21% of the companies in the same industry.

Every day, new Affordable Growth stocks can be found on ChartMill in our Affordable Growth screener.

Our latest full fundamental report of CAH contains the most current fundamental analsysis.

Disclaimer

Important Note: The content of this article is not intended as trading advice. It is essential to perform your own analysis and exercise caution when making trading decisions. The article presents observations created by automated analysis but does not guarantee any trading or investment outcomes. Always trade responsibly and make independent judgments.