Pre-Market Activity Shows Gains For Cardinal Health (CAH)

Editor's Note: Any reference to TheStreet Ratings and its underlying recommendation does not reflect the opinion of TheStreet, Inc. or any of its contributors including Jim Cramer or Stephanie Link.

Trade-Ideas LLC identified Cardinal Health ( CAH) as a pre-market leader candidate. In addition to specific proprietary factors, Trade-Ideas identified Cardinal Health as such a stock due to the following factors:

  • CAH has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $206.5 million.
  • CAH traded 15,133 shares today in the pre-market hours as of 9:28 AM.
  • CAH is up 2.6% today from Friday's close.

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More details on CAH:

Cardinal Health, Inc., a healthcare services company, provides pharmaceutical and medical products and services in the United States and internationally. The company operates in two segments, Pharmaceutical and Medical. The stock currently has a dividend yield of 2.3%. CAH has a PE ratio of 53.5. Currently there are 9 analysts that rate Cardinal Health a buy, no analysts rate it a sell, and 3 rate it a hold.

The average volume for Cardinal Health has been 1.9 million shares per day over the past 30 days. Cardinal Health has a market cap of $17.8 billion and is part of the services sector and wholesale industry. The stock has a beta of 0.49 and a short float of 2.1% with 1.68 days to cover. Shares are up 27.2% year to date as of the close of trading on Friday.

STOCKS TO BUY: TheStreet Quant Ratings has identified a handful of stocks that can potentially TRIPLE in the next 12-months. Learn more.

TheStreetRatings.com Analysis:

TheStreet Quant Ratings rates Cardinal Health as a buy. The company's strengths can be seen in multiple areas, such as its good cash flow from operations and solid stock price performance. We feel these strengths outweigh the fact that the company has had sub par growth in net income.

Highlights from the ratings report include:
  • Net operating cash flow has significantly increased by 380.63% to $300.00 million when compared to the same quarter last year. In addition, CARDINAL HEALTH INC has also vastly surpassed the industry average cash flow growth rate of 139.34%.
  • Compared to its closing price of one year ago, CAH's share price has jumped by 35.25%, exceeding the performance of the broader market during that same time frame. Looking ahead, the stock's sharp rise over the last year has already helped drive it to a level which is relatively expensive compared to the rest of its industry. We feel, however, that other strengths this company displays justify these higher price levels.
  • CARDINAL HEALTH INC has experienced a steep decline in earnings per share in the most recent quarter in comparison to its performance from the same quarter a year ago. The company has suffered a declining pattern of earnings per share over the past two years. However, we anticipate this trend to reverse over the coming year. During the past fiscal year, CARDINAL HEALTH INC reported lower earnings of $0.95 versus $3.07 in the prior year. This year, the market expects an improvement in earnings ($3.57 versus $0.95).
  • CAH, with its decline in revenue, underperformed when compared the industry average of 9.2%. Since the same quarter one year prior, revenues slightly dropped by 5.0%. Weakness in the company's revenue seems to have hurt the bottom line, decreasing earnings per share.
  • The gross profit margin for CARDINAL HEALTH INC is currently extremely low, coming in at 5.20%. Regardless of CAH's low profit margin, it has managed to increase from the same period last year. Despite the mixed results of the gross profit margin, the net profit margin of -2.30% trails the industry average.

STOCKS TO BUY: TheStreet Quant Ratings has identified a handful of stocks that can potentially TRIPLE in the next 12-months. Learn more.
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