Core Insights - The 2025 Q4 earnings season has been positive, with strong growth and many companies exceeding expectations, highlighted by NVIDIA's release [1][7] Boot Barn (BOOT) Earnings - Boot Barn reported a 16% year-over-year sales increase and a 5.7% rise in same-store sales, indicating strong performance in existing stores while opening 25 new locations, bringing the total to 514 [2] - The company's gross margin improved to 39.9% from 39.3% year-over-year, reflecting positive margin expansion and strong post-earnings reaction [3] - Boot Barn holds a Zacks Rank 1 (Strong Buy) with bullish EPS expectations for FY26 [4] Palantir (PLTR) Earnings - Palantir's sales reached $1.4 billion, a 70% year-over-year increase, with U.S. sales growing 93% year-over-year to $1.1 billion [8] - The company closed over $4.2 billion in total contract value, up more than 130% from the previous year, and customer count surged 34% [9] - Despite some price action challenges, the fiscal year EPS outlook remains very bullish, with a Zacks Rank 2 (Buy) [10] Cardinal Health (CAH) Earnings - Cardinal Health achieved an 18.8% year-over-year sales increase and a 36.3% growth in adjusted EPS, marking a strong recovery after stagnation in 2024 [12] - Sales growth was broad-based, particularly in Pharmaceuticals and Specialty Solutions, which account for approximately 90% of total sales, growing 19% year-over-year [15] - The company raised its FY26 outlook, expecting adjusted EPS between $10.15 and $10.35, indicating a 24.5% year-over-year growth [16] Summary of Performance - Boot Barn, Palantir, and Cardinal Health all reported robust quarterly results and have favorable Zacks Ranks, indicating strong investment potential [17]

Core Insights - Investors should not rely solely on stock price movements without understanding a company's fundamentals, as this can lead to financial losses. A thorough review of a company's financial health is essential, particularly in an unpredictable market [1] Interest Coverage Ratio - The interest coverage ratio is a critical metric that indicates how effectively a company can pay interest charges on its debt [3][4] - This ratio is calculated by dividing Earnings before Interest & Taxes (EBIT) by Interest Expense, providing insight into a company's ability to meet its interest obligations [4] - A ratio lower than 1 indicates potential default risk, while a higher ratio suggests a company can withstand financial difficulties [6] Investment Strategy - Companies with an interest coverage ratio above the industry average, a favorable Zacks Rank, and a VGM Score of A or B are likely to yield better investment results [7] - Additional criteria for screening include a minimum stock price of $5, strong historical and projected EPS growth compared to the industry median, and an average trading volume greater than 100,000 [8][9] Company Performance Highlights - Boot Barn Holdings, Inc. (BOOT) has a Zacks Rank of 1, a VGM Score of B, and is projected to have a 17.6% sales growth and 26% EPS growth this fiscal year, with a stock price increase of 36.2% over the past year [10][11] - Brinker International, Inc. (EAT) also holds a Zacks Rank of 1 and a VGM Score of A, with expected sales growth of 7.9% and EPS growth of 19.8%, although its stock has declined by 3.6% in the past year [11][12] - Tapestry, Inc. (TPR) has a Zacks Rank of 1 and a VGM Score of B, with projected sales growth of 9.6% and EPS growth of 23.7%, and a significant stock increase of 72.8% over the past year [12][13] - Cardinal Health, Inc. (CAH) carries a Zacks Rank of 2 and a VGM Score of A, with anticipated sales growth of 16.5% and EPS growth of 25.1%, and a stock surge of 74.8% in the past year [13][14]

Core Viewpoint - McKesson Corporation has shown strong financial performance and stock growth, outperforming both the broader market and sector-specific indices, indicating a positive outlook for the company. Group 1: Company Overview - McKesson Corporation, based in Irving, Texas, distributes pharmaceuticals, medical-surgical supplies, and health and beauty care products primarily in North America, with a market capitalization of $114.5 billion [1]. - The company operates through four segments: U.S. Pharmaceutical, Prescription Technology Solutions (RxTS), Medical-Surgical Solutions, and International [1]. Group 2: Stock Performance - McKesson's shares have outperformed the broader market over the past year, with a growth of 55.2% over the past 52 weeks and 14% year-to-date, compared to the S&P 500 Index's return of 11.8% [2]. - The stock has also outperformed the State Street Healthcare Select Sector SPDR ETF (XLV), which rose by 7.7% over the past 52 weeks [3]. Group 3: Earnings Performance - On February 5, McKesson's shares surged by 16.5% following the release of better-than-expected Q3 2026 earnings, with revenue increasing by 11.4% year-over-year to $106.2 billion, aligning with market expectations [3]. - The adjusted EPS for the quarter was $9.34, surpassing Wall Street estimates, and the company anticipates full-year earnings in the range of $38.80 to $39.20 per share [3]. Group 4: Analyst Expectations - For the current fiscal year ending in March 2026, analysts expect McKesson's EPS to grow by 18.1% year-over-year to $39.03 on a diluted basis, with a strong earnings surprise history [4]. - Among 17 analysts covering McKesson stock, the consensus rating is a "Strong Buy," supported by 13 "Strong Buy" ratings and four "Holds" [4]. Group 5: Price Target and Analyst Ratings - JP Morgan analyst Lisa Gill maintained an "Overweight" rating on McKesson, raising the price target from $983 to $1,107, indicating an 18.4% potential upside from the current price levels [5]. - The mean price target of $965.56 suggests a 3.3% premium to McKesson's current price [5].

Core Viewpoint - Cencora, Inc. has successfully priced a total of $3.5 billion in senior notes with varying interest rates and maturity dates, indicating strong market demand for its debt offerings [1] Group 1: Debt Offerings - The company priced $500 million of its 3.950% Senior Notes due February 13, 2029 [1] - Additionally, $500 million of its 4.250% Senior Notes due November 15, 2030 was also priced [1] - The company further issued $500 million of its 4.600% Senior Notes due February 13, 2033 [1] - Lastly, Cencora priced $1.0 billion of its 4.900% Senior Notes due February [1]

Core Insights - Cencora, Inc. (NYSE:COR) is a significant player in the healthcare distribution sector, known for its extensive network and efficient supply chain solutions, competing with major distributors like McKesson and Cardinal Health [1][6] - Wells Fargo has maintained an "Overweight" rating for Cencora, raising its price target from $405 to $429, indicating optimism about the company's future performance [1][5][6] Investment Activity - BI Asset Management Fondsmaeglerselskab A S increased its holdings in Cencora by 17.9% during the third quarter, now owning 144,287 shares valued at approximately $45 million, representing about 0.07% of Cencora's total market value [2][6] - Other investors, including Ameritas Advisory Services LLC and Simplicity Wealth LLC, have also made new investments in Cencora, with stakes valued at around $157,000 and $555,000 respectively [3][6] - Grimes and Company Inc. increased its holdings by 3.6%, now owning 1,272 shares valued at $381,000 [3] Stock Performance - Cencora's stock is currently priced at $363.27, reflecting a price change of $4.02, or a 1.119% increase, with fluctuations between a low of $358.94 and a high of $367.28 on the day [4][6] - Over the past year, the stock has reached a high of $377.54 and a low of $237.71, indicating significant volatility [4][6] - Cencora's market capitalization stands at approximately $70.67 billion, with a trading volume of 946,209 shares, highlighting the company's strong position in the industry [5]

Core Insights - Cardinal Health is a significant player in the healthcare sector, providing pharmaceuticals and medical products to over 100,000 locations daily, focusing on high-margin specialty services and clinical products [1] - Wells Fargo upgraded Cardinal Health to "Overweight" with a price target increase from $237 to $256, indicating a positive outlook on the stock [2][6] Financial Performance - Cardinal Health's Q2 2026 results exceeded expectations, reporting a 19% increase in revenue to $66 billion and a 36% rise in non-GAAP EPS to $2.63, driven by strong pharmaceutical demand [3][6] - The company raised its fiscal year 2026 EPS guidance to between $10.15 and $10.35, indicating a year-over-year growth of 23-26% [4][6] Segment Performance - All five operating segments achieved double-digit profit growth, with the Pharmaceutical and Specialty Solutions segment leading with a 29% increase [4] - Sales of GLP-1 medications contributed approximately 6 percentage points to the revenue growth in the Pharmaceutical and Specialty Solutions segment, while the BioPharma Solutions segment experienced over 30% revenue growth [5]

Company Overview - Cencora, Inc. is a leading global pharmaceutical distribution and healthcare solutions company with a market cap of approximately $70.5 billion, connecting drug manufacturers with pharmacies, hospitals, and healthcare providers worldwide [1] Stock Performance - Cencora's stock has significantly outperformed the broader market, soaring 46.6% over the past 52 weeks compared to the S&P 500 Index's 15.6% gains [2] - The stock is up 7.6% in 2026, surpassing the index's 1.7% rise [2] - Cencora has also outperformed the VanEck Pharmaceutical ETF, which gained 22.9% over the past 52 weeks and 6.5% year-to-date [3] Financial Results - For fiscal 2026 first-quarter results, Cencora reported revenue of about $85.9 billion, up 5.5% year over year, with adjusted diluted EPS rising to $4.08, an increase of roughly 9% from the prior year [5] - Adjusted gross profit climbed to $3 billion, supported by strong volumes and favorable segment mix, while adjusted operating income grew nearly 12% to $1.1 billion [5] Earnings Expectations - Analysts expect Cencora to deliver an adjusted EPS of $17.57 for the current year ending in September, representing a 9.8% year-over-year increase [6] - The company has a strong earnings surprise history, surpassing bottom-line estimates in each of the past four quarters [6] Analyst Ratings - Among the 16 analysts covering Cencora stock, the consensus rating is a "Strong Buy," based on 14 "Strong Buys" and two "Holds" [6] - The bullish sentiment has increased from a month ago when there were 12 "Strong Buy" suggestions [7] - Evercore ISI recently lowered its price target on Cencora to $420 from $440 while maintaining an "Outperform" rating, indicating that the recent 8% selloff appears overdone [7]

Core Insights - McKesson Corporation (MCK) reported third-quarter fiscal 2026 adjusted earnings per share (EPS) of $9.34, exceeding the Zacks Consensus Estimate of $9.31 by 0.3%, and reflecting a year-over-year improvement of 16.3% driven by strong operational growth and acquisitions in the Oncology & Multispecialty segment [1][7] Revenue Details - Revenues reached $106.16 billion, surpassing the Zacks Consensus Estimate by 0.5%, and increased by 11.4% year over year, primarily due to higher prescription volumes from retail national account customers and growth in oncology and specialty product distribution [2][7] - The North American Pharmaceutical segment generated revenues of $88.3 billion, up 9% year over year, attributed to increased prescription volumes and specialty products [5] Segmental Analysis - The Oncology & Multispecialty segment reported revenues of $13 billion, a significant increase of 37% year over year, driven by growth in provider solutions and specialty distribution, along with contributions from acquisitions [8] - The Prescription Technology Solutions segment's revenues totaled $1.5 billion, up 9% year over year, supported by increased prescription volumes in third-party logistics and technology services [9] - The Medical-Surgical Solutions segment generated revenues of $3 billion, a modest increase of 1% year over year, with adjusted operating profit down 10% due to reduced volumes in physician office settings [10] Financial Performance - Adjusted gross profit was $3.66 billion, reflecting a year-over-year increase of 9.6%, while adjusted operating income rose 13.4% to $1.81 billion, with an operating margin of 1.9%, expanding nearly 22 basis points year over year [11] - Cash and cash equivalents stood at $2.96 billion, down from $4 billion in the previous quarter, with cumulative net cash provided by operating activities amounting to $2.73 billion [12] Fiscal 2026 Guidance - McKesson raised its EPS guidance for fiscal 2026 to a range of $38.80-$39.20 from the previous $38.35-$38.85, and expects total revenue growth of 12-16%, up from the prior guidance of 11-15% [13][16] Strategic Developments - The company is progressing towards the spin-off of its Medical-Surgical Solutions business, expected to be completed by the second half of calendar 2027, and has divested its retail and distribution businesses in Norway, marking its exit from European operations [15]

Financial Data and Key Metrics Changes - Cardinal Health reported total revenue for Q2 increased by 19% to $66 billion, driven by strong demand in the pharmaceutical and specialty solutions segment [10] - Gross margin dollars increased by 24% to $2.4 billion, reflecting a favorable mix across businesses [10] - Non-GAAP diluted EPS for the quarter was $2.63, a 36% increase compared to $1.93 in the same quarter last year [12] Business Line Data and Key Metrics Changes - Pharmaceutical and Specialty Solutions segment revenue increased by 19% to $61 billion, with segment profit rising by 29% to $687 million [12][14] - GMPD segment revenue grew by 3% to $3.3 billion, with segment profit increasing to $37 million from $18 million in the prior year [15] - Other growth businesses, including Nuclear and Precision Health Solutions, at-Home Solutions, and OptiFreight Logistics, saw revenue increase by 34% to $1.7 billion, with segment profit up by 52% to $179 million [16] Market Data and Key Metrics Changes - The company expects specialty revenues to surpass $50 billion in fiscal 2026, indicating strong growth in this high-margin area [7] - The GMPD segment's revenue growth was partially attributed to inventory restocking by distributors, which is expected to normalize in Q3 [15][21] Company Strategy and Development Direction - Cardinal Health is focused on strengthening its core business while expanding in specialty and other growth areas, with a commitment to operational excellence and simplification [6][23] - The acquisition of Solaris Health is expected to enhance the company's specialty offerings and market position [7][25] - The company is committed to investing in technology and infrastructure to improve service levels and operational efficiency [25][31] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's ability to navigate the dynamic healthcare environment and deliver sustainable growth [23][32] - The updated fiscal year 2026 EPS guidance was raised to a range of $10.15-$10.35, reflecting strong performance and momentum across the portfolio [19][23] - Management noted that while there are expectations for continued strong demand, they are not assuming outsized demand for the remainder of the year [39] Other Important Information - The company generated $1.8 billion in adjusted free cash flow year-to-date and ended the quarter with a cash position of $2.8 billion [18] - Cardinal Health has returned $1 billion to shareholders so far this year, including $375 million in share repurchases [18] Q&A Session Summary Question: Can you unpack or break down some of the components of the profit performance in Pharma Solutions? - Management noted strong demand across all categories in the pharma business, with significant contributions from specialty and generics, and emphasized strong execution by operations teams [35][37] Question: Can you parse apart the other segment a little bit? - Management indicated that the core business remains strong across the three businesses within the other segment, with the ADS acquisition performing at least consistent with expectations [46][48] Question: Can you give us a bit more on capital allocation and the capacity for further transactions? - Management highlighted a disciplined capital allocation framework and noted flexibility to assess growth opportunities while protecting the core business [52][56] Question: Should we expect to see manufacturer brand drug price decreases impact revenue or operating income? - Management stated that anticipated changes in manufacturer pricing would be adjusted within the cost structure to preserve margins, and they do not foresee significant impacts on revenue [76][78] Question: How is the company modeling revenue or earnings for GLP-1s this year? - Management indicated that while GLP-1s have seen significant volume growth, they do not expect it to be a meaningful driver for underlying profitability moving forward [84][85]

Financial Data and Key Metrics Changes - The company reported total revenue for Q2 increased by 19% to $66 billion, driven by strong demand in the pharmaceutical and specialty solutions segment [10][12] - Gross margin dollars increased by 24% to $2.4 billion, reflecting a favorable mix across businesses [10] - Non-GAAP diluted EPS for the quarter was $2.63, a 36% increase compared to $1.93 in the same quarter last year [12] Business Line Data and Key Metrics Changes - Pharmaceutical and Specialty Solutions segment revenue increased by 19% to $61 billion, with segment profit rising by 29% to $687 million [12][13] - GMPD segment revenue grew by 3% to $3.3 billion, with segment profit increasing to $37 million from $18 million in the prior year [15] - Other growth businesses, including Nuclear and Precision Health Solutions, At-Home Solutions, and OptiFreight Logistics, saw revenue increase by 34% to $1.7 billion, with segment profit up by 52% to $179 million [16] Market Data and Key Metrics Changes - The company expects specialty revenues to surpass $50 billion in fiscal 2026, indicating strong growth in this high-margin area [7] - The GMPD segment's revenue growth was partially attributed to inventory restocking by distributors, which is expected to normalize in Q3 [15][21] Company Strategy and Development Direction - The company is focused on strengthening its core distribution business while expanding in specialty and other growth areas [5][23] - The acquisition of Solaris Health is expected to enhance the company's capabilities in the specialty market [7][25] - The company is committed to operational excellence and simplification to drive value for customers and shareholders [23][31] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's ability to navigate the dynamic healthcare environment and deliver sustainable growth [23][24] - The updated fiscal year 2026 EPS guidance was raised to a range of $10.15-$10.35, reflecting strong performance and momentum across the portfolio [19][20] - Management noted that while there are challenges in the market, the company is well-positioned to maintain profitability and growth [76][81] Other Important Information - The company generated $1.8 billion in adjusted free cash flow year-to-date and ended the quarter with a cash position of $2.8 billion [18] - The company has returned $1 billion to shareholders so far this year, including $375 million in share repurchases [18][19] Q&A Session Summary Question: Can you break down some components of the profit performance in Pharma Solutions? - Management noted strong demand across all categories, with significant contributions from specialty and generics, and emphasized strong execution by operations teams [35][37] Question: How is the ADS acquisition performing? - Management indicated that the ADS acquisition is performing at least consistent with expectations, with strong core growth across the three businesses in the other segment [44][46] Question: What is the outlook for capital allocation? - Management highlighted a disciplined capital allocation framework and noted flexibility to assess growth opportunities while protecting the core business [52][56] Question: How does the macro pricing environment impact guidance? - Management stated that anticipated changes in manufacturer pricing would be adjusted within the cost structure to preserve margins, with no significant impact expected on revenue guidance [74][76] Question: What is the impact of GLP-1s on revenue and earnings? - Management indicated that while GLP-1s have contributed to revenue growth, they do not anticipate it being a significant driver for underlying profitability going forward [80][81]