MCKESSON CORP (MCK) Stock Fundamental Analysis
USA - New York Stock Exchange - NYSE:MCK - US58155Q1031 - Common Stock
827.33 USD
-3.09 (-0.37%)
827.045 USD
-0.29 (-0.03%)
Overall MCK gets a fundamental rating of 6 out of 10. We evaluated MCK against 101 industry peers in the Health Care Providers & Services industry. MCK has only an average score on both its financial health and profitability. MCK is not priced too expensively while it is growing strongly. Keep and eye on this one! These ratings could make MCK a good candidate for growth investing.
1. Profitability
1.1 Basic Checks
In the past year MCK was profitable.
MCK had a positive operating cash flow in the past year.
MCK had positive earnings in 4 of the past 5 years.
Each year in the past 5 years MCK had a positive operating cash flow.
1.2 Ratios
The Return On Assets of MCK (4.79%) is better than 75.25% of its industry peers.
MCK's Return On Invested Capital of 26.27% is amongst the best of the industry. MCK outperforms 97.03% of its industry peers.
Measured over the past 3 years, the Average Return On Invested Capital for MCK is significantly above the industry average of 9.58%.
The 3 year average ROIC (24.61%) for MCK is below the current ROIC(26.27%), indicating increased profibility in the last year.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 4.79% | ||
| ROE | N/A | ||
| ROIC | 26.27% |
ROA(3y)4.85%
ROA(5y)1.87%
ROE(3y)N/A
ROE(5y)N/A
ROIC(3y)24.61%
ROIC(5y)21.23%
1.3 Margins
Looking at the Profit Margin, with a value of 1.04%, MCK is in line with its industry, outperforming 55.45% of the companies in the same industry.
In the last couple of years the Profit Margin of MCK has grown nicely.
The Operating Margin of MCK (1.34%) is comparable to the rest of the industry.
In the last couple of years the Operating Margin of MCK has remained more or less at the same level.
MCK's Gross Margin of 3.47% is on the low side compared to the rest of the industry. MCK is outperformed by 81.19% of its industry peers.
MCK's Gross Margin has declined in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 1.34% | ||
| PM (TTM) | 1.04% | ||
| GM | 3.47% |
OM growth 3Y-0.01%
OM growth 5Y0.07%
PM growth 3Y29.56%
PM growth 5Y18.7%
GM growth 3Y-10.54%
GM growth 5Y-7.09%
2. Health
2.1 Basic Checks
With a Return on Invested Capital (ROIC) well above the Cost of Capital (WACC), MCK is creating value.
MCK has less shares outstanding than it did 1 year ago.
The number of shares outstanding for MCK has been reduced compared to 5 years ago.
Compared to 1 year ago, MCK has an improved debt to assets ratio.
2.2 Solvency
An Altman-Z score of 5.73 indicates that MCK is not in any danger for bankruptcy at the moment.
With an excellent Altman-Z score value of 5.73, MCK belongs to the best of the industry, outperforming 88.12% of the companies in the same industry.
MCK has a debt to FCF ratio of 1.29. This is a very positive value and a sign of high solvency as it would only need 1.29 years to pay back of all of its debts.
Looking at the Debt to FCF ratio, with a value of 1.29, MCK belongs to the top of the industry, outperforming 88.12% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | N/A | ||
| Debt/FCF | 1.29 | ||
| Altman-Z | 5.73 |
ROIC/WACC2.96
WACC8.88%
2.3 Liquidity
A Current Ratio of 0.88 indicates that MCK may have some problems paying its short term obligations.
With a Current ratio value of 0.88, MCK is not doing good in the industry: 78.22% of the companies in the same industry are doing better.
MCK has a Quick Ratio of 0.88. This is a bad value and indicates that MCK is not financially healthy enough and could expect problems in meeting its short term obligations.
MCK has a worse Quick ratio (0.50) than 88.12% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 0.88 | ||
| Quick Ratio | 0.5 |
3. Growth
3.1 Past
The Earnings Per Share has grown by an impressive 25.63% over the past year.
Measured over the past years, MCK shows a quite strong growth in Earnings Per Share. The EPS has been growing by 17.17% on average per year.
The Revenue has grown by 17.23% in the past year. This is quite good.
Measured over the past years, MCK shows a quite strong growth in Revenue. The Revenue has been growing by 9.22% on average per year.
EPS 1Y (TTM)25.63%
EPS 3Y11.79%
EPS 5Y17.17%
EPS Q2Q%39.46%
Revenue 1Y (TTM)17.23%
Revenue growth 3Y10.8%
Revenue growth 5Y9.22%
Sales Q2Q%10.14%
3.2 Future
The Earnings Per Share is expected to grow by 13.83% on average over the next years. This is quite good.
Based on estimates for the next years, MCK will show a quite strong growth in Revenue. The Revenue will grow by 8.52% on average per year.
EPS Next Y18.06%
EPS Next 2Y15.64%
EPS Next 3Y14.92%
EPS Next 5Y13.83%
Revenue Next Year12.63%
Revenue Next 2Y10.46%
Revenue Next 3Y9.68%
Revenue Next 5Y8.52%
3.3 Evolution
When comparing the EPS growth rate of the last years to the growth rate of the upcoming years, we see that the growth is stable.
The Revenue growth rate is stable: in the next years the growth will be about the same than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
With a Price/Earnings ratio of 22.81, MCK is valued on the expensive side.
Based on the Price/Earnings ratio, MCK is valued a bit cheaper than the industry average as 64.36% of the companies are valued more expensively.
MCK is valuated at similar levels of the S&P average when we compare the Price/Earnings ratio to 26.77, which is the current average of the S&P500 Index.
A Price/Forward Earnings ratio of 18.69 indicates a rather expensive valuation of MCK.
Based on the Price/Forward Earnings ratio, MCK is valued a bit cheaper than the industry average as 65.35% of the companies are valued more expensively.
MCK's Price/Forward Earnings ratio indicates a similar valuation than the S&P500 average which is at 23.35.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 22.81 | ||
| Fwd PE | 18.69 |
4.2 Price Multiples
MCK's Enterprise Value to EBITDA is on the same level as the industry average.
Compared to the rest of the industry, the Price/Free Cash Flow ratio of MCK indicates a somewhat cheap valuation: MCK is cheaper than 72.28% of the companies listed in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 16.96 | ||
| EV/EBITDA | 18.2 |
4.3 Compensation for Growth
MCK's PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a correct valuation of the company.
MCK has a very decent profitability rating, which may justify a higher PE ratio.
MCK's earnings are expected to grow with 14.92% in the coming years. This may justify a more expensive valuation.
PEG (NY)1.26
PEG (5Y)1.33
EPS Next 2Y15.64%
EPS Next 3Y14.92%
5. Dividend
5.1 Amount
MCK has a yearly dividend return of 0.40%, which is pretty low.
MCK's Dividend Yield is rather good when compared to the industry average which is at 0.60. MCK pays more dividend than 80.20% of the companies in the same industry.
Compared to an average S&P500 Dividend Yield of 2.00, MCK's dividend is way lower than the S&P500 average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.4% |
5.2 History
The dividend of MCK is nicely growing with an annual growth rate of 10.13%!
MCK has been paying a dividend for at least 10 years, so it has a reliable track record.
The dividend of MCK decreased in the last 3 years.
Dividend Growth(5Y)10.13%
Div Incr Years2
Div Non Decr Years2
5.3 Sustainability
8.98% of the earnings are spent on dividend by MCK. This is a low number and sustainable payout ratio.
The dividend of MCK is growing, but earnings are growing more, so the dividend growth is sustainable.
DP8.98%
EPS Next 2Y15.64%
EPS Next 3Y14.92%
827.33
-3.09 (-0.37%)
Chartmill FA Rating
GICS SectorHealth Care
GICS IndustryGroupHealth Care Equipment & Services
GICS IndustryHealth Care Providers & Services
Earnings (Last)
Earnings (Next)
Inst Owners90.24%
Inst Owner Change-0.67%
Ins Owners0.03%
Ins Owner Change-24.5%
Market Cap102.12B
Revenue(TTM)387.09B
Net Income(TTM)4.03B
Analysts83.81
Price Target955.45 (15.49%)
Short Float %1.72%
Short Ratio2.91
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.4% |
Yearly Dividend2.71
Dividend Growth(5Y)10.13%
DP8.98%
Div Incr Years2
Div Non Decr Years2
Ex-Date
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)4.19%
Min EPS beat(2)0.39%
Max EPS beat(2)8%
EPS beat(4)3
Avg EPS beat(4)2.47%
Min EPS beat(4)-0.54%
Max EPS beat(4)8%
EPS beat(8)6
Avg EPS beat(8)3.13%
EPS beat(12)9
Avg EPS beat(12)4.57%
EPS beat(16)11
Avg EPS beat(16)4.41%
Revenue beat(2)1
Avg Revenue beat(2)-0.56%
Min Revenue beat(2)-1.93%
Max Revenue beat(2)0.81%
Revenue beat(4)1
Avg Revenue beat(4)-1.89%
Min Revenue beat(4)-4.64%
Max Revenue beat(4)0.81%
Revenue beat(8)3
Avg Revenue beat(8)-1.31%
Revenue beat(12)6
Avg Revenue beat(12)-0.54%
Revenue beat(16)9
Avg Revenue beat(16)-0.02%
PT rev (1m)1.87%
PT rev (3m)19.22%
EPS NQ rev (1m)0.04%
EPS NQ rev (3m)-6.15%
EPS NY rev (1m)0.93%
EPS NY rev (3m)2.87%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)0.4%
Revenue NY rev (1m)-0.1%
Revenue NY rev (3m)0.14%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 22.81 | ||
| Fwd PE | 18.69 | ||
| P/S | 0.26 | ||
| P/FCF | 16.96 | ||
| P/OCF | 14.84 | ||
| P/B | N/A | ||
| P/tB | N/A | ||
| EV/EBITDA | 18.2 |
EPS(TTM)36.27
EY4.38%
EPS(NY)44.26
Fwd EY5.35%
FCF(TTM)48.79
FCFY5.9%
OCF(TTM)55.75
OCFY6.74%
SpS3136.14
BVpS-14.09
TBVpS-139.69
PEG (NY)1.26
PEG (5Y)1.33
Graham NumberN/A
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 4.79% | ||
| ROE | N/A | ||
| ROCE | 32.18% | ||
| ROIC | 26.27% | ||
| ROICexc | 34.94% | ||
| ROICexgc | N/A | ||
| OM | 1.34% | ||
| PM (TTM) | 1.04% | ||
| GM | 3.47% | ||
| FCFM | 1.56% |
ROA(3y)4.85%
ROA(5y)1.87%
ROE(3y)N/A
ROE(5y)N/A
ROIC(3y)24.61%
ROIC(5y)21.23%
ROICexc(3y)38.33%
ROICexc(5y)31.81%
ROICexgc(3y)N/A
ROICexgc(5y)N/A
ROCE(3y)30.15%
ROCE(5y)26.01%
ROICexgc growth 3YN/A
ROICexgc growth 5YN/A
ROICexc growth 3Y25.12%
ROICexc growth 5Y23.76%
OM growth 3Y-0.01%
OM growth 5Y0.07%
PM growth 3Y29.56%
PM growth 5Y18.7%
GM growth 3Y-10.54%
GM growth 5Y-7.09%
F-Score7
Asset Turnover4.6
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | N/A | ||
| Debt/FCF | 1.29 | ||
| Debt/EBITDA | 1.03 | ||
| Cap/Depr | 132.36% | ||
| Cap/Sales | 0.22% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 117.85% | ||
| Profit Quality | 149.32% | ||
| Current Ratio | 0.88 | ||
| Quick Ratio | 0.5 | ||
| Altman-Z | 5.73 |
F-Score7
WACC8.88%
ROIC/WACC2.96
Cap/Depr(3y)111.68%
Cap/Depr(5y)95.54%
Cap/Sales(3y)0.22%
Cap/Sales(5y)0.23%
Profit Quality(3y)140.62%
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)25.63%
EPS 3Y11.79%
EPS 5Y17.17%
EPS Q2Q%39.46%
EPS Next Y18.06%
EPS Next 2Y15.64%
EPS Next 3Y14.92%
EPS Next 5Y13.83%
Revenue 1Y (TTM)17.23%
Revenue growth 3Y10.8%
Revenue growth 5Y9.22%
Sales Q2Q%10.14%
Revenue Next Year12.63%
Revenue Next 2Y10.46%
Revenue Next 3Y9.68%
Revenue Next 5Y8.52%
EBIT growth 1Y18.47%
EBIT growth 3Y10.79%
EBIT growth 5Y9.29%
EBIT Next Year24.69%
EBIT Next 3Y14.23%
EBIT Next 5Y12.64%
FCF growth 1Y39.85%
FCF growth 3Y15.87%
FCF growth 5Y6.2%
OCF growth 1Y40.26%
OCF growth 3Y16.04%
OCF growth 5Y6.83%
MCKESSON CORP / MCK FAQ
What is the ChartMill fundamental rating of MCKESSON CORP (MCK) stock?
ChartMill assigns a fundamental rating of 6 / 10 to MCK.
What is the valuation status of MCKESSON CORP (MCK) stock?
ChartMill assigns a valuation rating of 4 / 10 to MCKESSON CORP (MCK). This can be considered as Fairly Valued.
What is the profitability of MCK stock?
MCKESSON CORP (MCK) has a profitability rating of 6 / 10.
What are the PE and PB ratios of MCKESSON CORP (MCK) stock?
The Price/Earnings (PE) ratio for MCKESSON CORP (MCK) is 22.81 and the Price/Book (PB) ratio is -58.72.
Can you provide the dividend sustainability for MCK stock?
The dividend rating of MCKESSON CORP (MCK) is 5 / 10 and the dividend payout ratio is 8.98%.