McKesson Inc. (MCK): Today's Featured Wholesale Laggard

Editor's Note: TheStreet ratings do not represent the views of TheStreet's staff or its contributors. Ratings are established by computer based on metrics for performance (which includes growth, stock performance, efficiency and valuation) and risk (volatility and solvency). Companies with poor cash flow or high debt levels tend to earn lower ratings in our model.

McKesson ( MCK) pushed the Wholesale industry lower today making it today's featured Wholesale laggard. The industry as a whole closed the day up 0.1%. By the end of trading, McKesson fell $1.12 (-1.1%) to $98.50 on light volume. Throughout the day, 659,579 shares of McKesson exchanged hands as compared to its average daily volume of 1.4 million shares. The stock ranged in price between $98.42-$99.58 after having opened the day at $99.56 as compared to the previous trading day's close of $99.62. Other companies within the Wholesale industry that declined today were: InfoSonics Corporation ( IFON), down 5.8%, Shengkai Innovations ( VALV), down 5.3%, Tessco Technologies ( TESS), down 4.8%, and China Auto Logistics ( CALI), down 4.6%.
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McKesson Corporation, together with its subsidiaries, delivers pharmaceuticals, medical supplies, and health care information technologies to the healthcare industry primarily in the United States. It operates in two segments, McKesson Distribution Solutions and McKesson Technology Solutions. McKesson has a market cap of $23.28 billion and is part of the services sector. The company has a P/E ratio of 15.1, below the S&P 500 P/E ratio of 17.7. Shares are up 27.9% year to date as of the close of trading on Tuesday. Currently there are six analysts that rate McKesson a buy, no analysts rate it a sell, and five rate it a hold.

TheStreet Ratings rates McKesson as a buy. The company's strengths can be seen in multiple areas, such as its solid stock price performance, impressive record of earnings per share growth, compelling growth in net income, notable return on equity and largely solid financial position with reasonable debt levels by most measures. We feel these strengths outweigh the fact that the company shows weak operating cash flow.

For investors not wanting singular stock exposure, ETFs may be of interest. Investors who are bullish on the wholesale industry could consider iShares Dow Jones US Cons Goods ( IYK) while those bearish on the wholesale industry could consider ProShares Ultra Sht Consumer Goods ( SZK).

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