Cencora

(New York Stock Exchange)
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Bullish +65

Cencora stock gains earnings momentum as fiscal 2027 outlook starts

Dividend Earnings report AI-generated analysis

📈 Cencora reported fourth-quarter revenue of $88.4 billion, a 5.5% increase year-over-year.

💰 Adjusted diluted EPS climbed 21.4% to $4.66 in the fourth quarter.

🚀 Full fiscal year 2026 adjusted operating income rose 14.0% to $4.8 billion.

📊 Fourth-quarter adjusted operating margin expanded to 1.41% from 1.22% a year prior.

💵 Management raised the quarterly dividend by 10% to $0.66 per share.

🔮 Fiscal 2027 EPS guidance ranges from $19.40 to $19.75, implying 8-10% growth.

📦 Revenue for fiscal 2027 is expected to grow between 3% and 5%.

🏥 Specialty services segment operating income projected to grow 18% to 21% in 2027.

🤝 The MWI Animal Health merger with Covetrus is expected to close on March 31, 2027.

💸 Cencora forecasts adjusted free cash flow of $3.5 billion for fiscal 2027.

Bullish Signals
  • Cencora reported a significant 21.4% year-over-year increase in adjusted diluted EPS to $4.66 for the fourth quarter.
  • The company achieved a 14.0% rise in full fiscal year 2026 adjusted operating income, reaching $4.8 billion.
  • Adjusted operating margin expanded to 1.41% in the fourth quarter, driven by the OneOncology acquisition.
  • Management raised the quarterly dividend by 10% to $0.66 per share, enhancing shareholder returns.
  • Fiscal 2027 guidance projects adjusted diluted EPS growth of 8% to 10%, targeting a range of $19.40 to $19.75.
  • The company reaffirmed its long-term target for adjusted operating income growth of 7% to 10%.
  • Specialty Pharmaceutical and Provider Services segment operating income is projected to grow 18% to 21% in fiscal 2027.
Risk Factors
  • Increased sales of GLP-1 medicines, which carry lower gross margins, partially offset the benefit from the OneOncology acquisition.
  • The fourth-quarter GAAP EPS was impacted by a $723.9 million goodwill impairment charge related to PharmaLex from the prior year.
Full Analysis
Cencora Inc. reported robust fiscal fourth-quarter and full-year results, signaling strong earnings momentum as it enters fiscal 2027. Fourth-quarter revenue increased 5.5% year-over-year to $88.4 billion, while adjusted diluted EPS surged 21.4% to $4.66. For the full fiscal year ended September 30, 2026, revenue grew 5.0% to $337.4 billion and adjusted operating income rose 14.0% to $4.8 billion. The company introduced a new reporting structure with revised segments focused on Pharmaceutical Distribution, Specialty Pharmaceutical, and Provider Services. Management attributed margin expansion in the fourth quarter partly to the acquisition of OneOncology, though lower-margin GLP-1 sales partially offset this benefit. The firm also declared a quarterly dividend increase of 10% to $0.66 per share. Looking ahead to fiscal 2027, Cencora expects adjusted diluted EPS between $19.40 and $19.75, representing growth of 8% to 10%. Revenue is forecasted to grow 3% to 5%, with segment operating income projected to rise significantly in specialty services. The outlook assumes the closure of the MWI Animal Health merger with Covetrus by March 31, 2027.