Cardinal Health Inc (CAH) stock analysis
Cardinal Health Inc (CAH) clears 3 of this site's 8 mechanical value filters, 5 of 8 Buffett-style checks and 2 of 5 Lynch-style checks. At $255.64 it trades 22.7% below this site's neutral DCF value (a margin of safety of +22.7%). Its earnings quality rates Strong and it returns +2.5% to shareholders net of dilution. Figures are as of October 23, 2026, from SEC filings and market data refreshed weekly; this is educational analysis, not investment advice.
Data as of October 23, 2026. Refreshed weekly from SEC filings and market data.
What does Cardinal Health do?
Cardinal Health distributes prescription drugs and medical supplies to hospitals, pharmacies and clinics, and makes some medical products itself. It earns thin margins on very large volumes.
Brands and businesses it owns
- Cardinal Health at-Home
- Solaris Health
What stands out about Cardinal Health?
- The share price implies 1.7% yearly growth. At $255.64, CAH's free cash flow of $19.36 per share would have to grow 1.7% a year, fading to 2.5% by year 10, for this site's DCF (10% discount rate) to match the price. This site's baseline starts at 8%, so the price asks for less growth than the baseline. Change the assumptions.
- Misses 3 of the 8 value filters. It fails Trailing P/E < 25 (34.85), PEG Ratio < 1.5 (2.74) and Price/Book < 8 (59.86); the other 3 pass and 2 were not evaluated. See every filter.
- The margin of safety is falling. It went from +30% on Oct 7 to +23% on Oct 23 across 5 weekly readings. See the trend.
- Weakest against peers: net margin. At 0.7% (peer median 9.3%) it ranks 32nd of 34 among health care stocks this site tracks. See the ranking.
- Dividend raises 1 of 6 flags. Its trailing yield is 0.82%. See the Sustainable Dividend Screener.
How has Cardinal Health's share price moved?
The interactive price chart needs JavaScript.
Is Cardinal Health undervalued? The value diligence check
Every value-investing signal this site computes for this stock, gathered in one place: the same real numbers from the tools below, not a new score.
- Margin of safety (DCF) +22.7%
- P/E vs. its own history 34.9x · near the cheap end Real range: 26.0x–75.1x over 4 years (net income per diluted share from each fiscal year's 10-K, paired with the real closing price at that fiscal year-end).
- Wall St. analyst rating Buy · 4.22/5 23 analysts this month: 8 strong buy, 12 buy, 3 hold, 0 sell, 0 strong sell (Finnhub). Up from 4.21 last month.
- Earnings quality (is the profit real?) Strong · all 5 checks clean Beneish M-score −2.74 · accruals −6.3% of assets · 275% of profit arrived as cash · stock comp 0.1% of revenue · share count −2.0% a year. From the latest 10-K (year to Jun 2026) - see the Earnings Quality Screener for how each check is scored.
- Shareholder yield (cash back to owners) +2.5% net Latest fiscal year (2026): dividends 0.8% + buybacks 2.3% − stock comp 0.6%, as a share of today's market cap. Over 14 years its split-adjusted share count fell 32%. See Shareholder Yield Leaders.
- Capital needed to grow (See's test) None needed · capital fell while profit grew Operating profit $1.4B → $2.0B, capital needed $14B → $7.2B, 2017–2026 (3-year averages); return on capital now 28% before tax. Buffett's See's Candies needed $0.42 per $1 of new profit, FlightSafety $3.20, a typical grower about $5. See Capital-Light Compounders.
- PEG (growth at a reasonable price) 2.74 · Well above fair P/E 34.9× ÷ 12.7% a year of growth behind it. 312th lowest of 447 stocks with a usable PEG. Lynch's fair value is a PEG of 1; a very high PEG usually means almost no growth, a very low one a profit spike. See PEG Ratio Ranking.
- Compounder lenses (4) 2 of 4 · misses capital-light, price Capital-light growth: not cleared (profit grew 1.4×, under 2×); Profit is real: cleared; Cash to owners: cleared; Fair price (PEG): not cleared (PEG 2.74, over 1.5). See Compounders at a Fair Price, which also lets you move the PEG bar.
- Value trap check Flagged (3/6 filters failed)
- Munger's Inversion Check 2 flags
- Standing vs. sector peers 3 of 7 measures above the median Compared with the 33 other health care stocks this site tracks: 3 in the top third, 4 in the bottom third.
- Dividend payout sustainability 1/6 flags
How does Cardinal Health compare with its peers?
3 of 7 measures sit above the median of the 33 other health care stocks tracked here, 3 in the top third and 4 in the bottom third.
- P/E ratiolower is cheaper · peer median 24.6× 34.9× ✕25th of 32
- Free-cash-flow yieldhigher is cheaper · peer median 5.5% 7.6% ✓7th of 34
- Return on equityhigher is better · peer median 15% 37% ✓6th of 34
- Net marginhigher is better · peer median 9.3% 0.7% ✕32nd of 34
- Revenue growthhigher is better, year on year · peer median 8.6% 14.2% ✓8th of 34
- Debt / equitylower is safer · peer median 0.69 5.65 ✕32nd of 34
- Dividend yieldamong dividend payers · peer median 1.10% 0.82% ✕16th of 21
Peers are the stocks this site tracks in the same sector group, not every listed competitor. The bar runs from the weakest peer (left) to the strongest (right); the tick is the middle. Measures that don't apply to a sector (cash-flow yield for banks, debt for financials) are left out.
What would Buffett & Lynch say?
Buffett's checklist is built around durable, profitable businesses bought at sensible prices, and CAH doesn't clear enough of it yet. In its favor: CAH is currently earning a strong return on shareholders' equity, has grown earnings per share at a solid clip over five years, earns many times its interest expense, so debt service isn't a worry, is trading below what a conservative discounted-cash-flow estimate says it's worth - his own "price is what you pay, value is what you get" test, not a fixed multiple ceiling, and trades at a reasonable multiple of owner earnings, his own term for the real cash a business could pay out. Where it comes up short: CAH and its five-year average return on equity falls short too, so this isn't just a one-off dip, carries more debt relative to equity than he typically tolerates, and runs thinner pretax margins than he'd like to see.
- ROE (TTM) > 11% ✓
- ROE (5yr avg) > 11% ✕
- Debt/Equity < 0.5 ✕
- Pretax margin > 15% ✕
- EPS growth (5yr) > 7% ✓
- Interest coverage > 5x ✓
- Trading below intrinsic value (DCF) ✓
- Price vs. owner earnings < 25x ✓
- Bonus: returning capital via buybacks FY2026
Lynch looked for growth stories that weren't overpriced for that growth, and CAH falls short of his bar. In its favor: CAH is growing earnings at the steady 10-20% pace of a proper Stalwart, and is backing its growth up with real free cash flow. Where it comes up short: CAH fails his signature PEG test, he'd call this pricey for the growth on offer, carries more debt than he liked to see, even allowing for the extra room a large, stable business gets, and is asking investors to pay a steep multiple for that growth.
- PEG < 1 ✕
- EPS growth 10%-20% ✓
- Debt/Equity < 0.6 ✕
- P/E < 27 ✕
- Price/FCF < 30 ✓
Quantitative approximations of each investor's documented approach, not endorsed by either investor or their estates - commentary, not this site's actual ranking criteria. Buffett never published a numeric checklist: only 2 of his 8 checks here trace to his own documented concepts ("owner earnings," from his 1986 shareholder letter, and "price is what you pay, value is what you get," his case against fixed P/E/P/B ceilings) - the other 6 (ROE, debt, margins, growth, interest coverage) use commonly-cited thresholds that are not numbers he himself published. The 8 hard filters below (plus the Munger check and Graham margin of safety) are this site's real, mechanical screen and are computed completely independently of the checklists above.
Berkshire Hathaway's own filing
Which of the 8 value filters does Cardinal Health pass?
- Market Cap > $25B $59.7B
- Trailing P/E < 25 34.85
- PEG Ratio < 1.5 2.74
- Price/Book < 8 59.86
- Price/Sales < 7 0.23
- EPS Growth YoY > -5% +70.1%
- vs 50-day MA (±12%) Not evaluated †
- vs 200-day MA (±12%) Not evaluated †
What is Cardinal Health's margin of safety?
+30% on 2026-10-07 → +23% on 2026-10-23 (5 weekly readings).
Where is Cardinal Health in its 52-week range?
What is the short interest in Cardinal Health?
7,369,236 shares short as of 2026-09-30 (FINRA settlement date). Reported twice a month, so this only changes roughly every two weeks, not daily.
What could go wrong with Cardinal Health? Munger's inversion check
"Invert, always invert." Instead of reasons to buy, these are reasons to hesitate, not a verdict, and not everything worth knowing about a business.
- Margin of safety, even in the bull case +54%
- Short interest under 5% of float 3.2%
- Passes most of the 6 fundamental filters 3/6 passed
- Price run-up backed by value, not just momentum +67% off 52wk low
- Debt/equity stable since 2017 1.53 → 3.48
Doesn't cover circle of competence, management quality, or accounting concerns: those need judgment, not data.
How much have Cardinal Health shareholders gained per year?
Earnings growth per share plus dividend.
An earnings-based proxy, not a stock-price total return - it doesn't capture multiple expansion/contraction or reinvested dividends. EPS from CAH's own 10-K filings; dividend yield is the current trailing yield on today's price, from the same weekly fetch as the rest of this site.
What do Cardinal Health's 10-year financials show?
From CAH's own 10-K filings (SEC EDGAR): up to the last 10 fiscal years. Press any year's bars for the exact figures.
Frequently asked questions about Cardinal Health
What kind of company is Cardinal Health?
Cardinal Health distributes prescription drugs and medical supplies to hospitals, pharmacies and clinics, and makes some medical products itself. It earns thin margins on very large volumes. Brands and businesses it owns include Cardinal Health at-Home and Solaris Health. This site groups it with Health Care stocks.
Is Cardinal Health trading above or below its DCF value?
At $255.64, CAH trades 22.7% below this site's neutral DCF value of $330.67 per share, a margin of safety of +22.7%. That DCF projects free cash flow for 10 years, with growth starting at 8% and fading to 2.5%, discounted at 10%; it is one set of assumptions, not a forecast. Test your own in the Intrinsic Value Calculator.
How many of this site's 8 value filters does Cardinal Health pass?
CAH passes 3 of 8. It passes Market Cap > $25B ($59.7B), Price/Sales < 7 (0.23) and EPS Growth YoY > -5% (+70.1%). It misses Trailing P/E < 25 (34.85), PEG Ratio < 1.5 (2.74) and Price/Book < 8 (59.86). vs 50-day MA (±12%) and vs 200-day MA (±12%) were not evaluated, because the moving-average checks only run on stocks that clear the fundamentals first. The 8-filter list shows every stock that passes all of them.
How much cash does Cardinal Health return to shareholders?
CAH's net shareholder yield is +2.5%: the cash it returns through dividends and buybacks, minus stock-based compensation, as a share of its market value. Latest fiscal year (2026): dividends 0.8% + buybacks 2.3% − stock comp 0.6%, as a share of today's market cap. Over 14 years its split-adjusted share count fell 32%. Its trailing dividend yield is 0.82%, paid out of 11% of its free cash flow; the dividend-sustainability check raises 1 of 6 flags (high leverage). See Shareholder Yield Leaders and the Sustainable Dividend Screener.
Where is Cardinal Health trading compared with its 52-week range?
At $255.64, CAH trades 66.7% above its 52-week low of $153.27 and 0.7% below its 52-week high of $257.55.
When does Cardinal Health report earnings next?
Cardinal Health's next earnings report is expected on November 5, 2026, with analysts expecting earnings of $2.97 per share. Dates come from the Finnhub earnings calendar and can move. In its last 4 quarters it beat the estimate 4 times, by an average of +9.5%.
Where do these numbers come from?
- Financial statements: Cardinal Health's 10-K annual report for the year ended Jun 30, 2026, filed Aug 11, 2026 (filing index). Every earlier year in the 10-year financials comes from the company's older 10-K filings, all listed on SEC EDGAR.
- Prices and market data: quotes, P/E and analyst ratings from Finnhub; daily price history and the 52-week range from Twelve Data, both refreshed weekly. Short interest comes from FINRA, reported twice a month.
- How to check a figure: click any number in the card above to see its exact source, and read the Editorial Standards for every rule behind the checks.
About this Cardinal Health Inc analysis
This page shows every value-investing check the site runs on Cardinal Health Inc (CAH) in one place: the 8 mechanical filters, the Buffett and Lynch checklists, a margin of safety from a disclosed DCF, earnings quality, shareholder yield and how it ranks against its sector peers. The numbers come from SEC filings and public market data, refreshed weekly, and the same rules apply to every stock on the stock list. See Editorial Standards for the sources and the rules, or run your own filters in the stock screener.