The fiscal quarter of the two 2019 CAH results from Cardinal Health, Inc. scheduled to be launched on February 7, before the market opens. While the results tend to show impressive growth in the central pharmaceutical segment, there is a possibility that headwinds in the medical glove sub-segment will improve prospects.
Overview of first quarter fiscal results
In the last quarter reported, Cardinal Health provided adjusted fiscal first quarter income of 2019 from $ 1.29 per share, which exceeded Zacks' consensus estimate of $ 1.06. Adjusted income increased 18% year on year.
Revenues increased 7.9% YoY to $ 35,210 million and exceeded consensus estimates of $ 33,540 million for Zacks.
Cardinal Health has a positive income shock of 9.3% on average for the past four quarters.
How is the second quarter forecast stepped on?
For the quarter to be reported, Zacks consensus estimates for earnings were set at $ 1.09 per share, reflecting a year-on-year decline of 16.8%. The same income was set at $ 36.3 billion, which showed 3% growth compared to the previous year's quarter.
Let's see how things are described before publication of results.
Pharmacy for Fiscal Impulses Q2
The pharmaceutical segment Cardinal Health is the second largest distributor of pharmaceutical products in the United States. This segment's products and services include pharmaceutical distribution, specialty manufacturers and services, as well as nuclear and pharmaceutical services, which are expected to increase second quarter results.
In the last quarter reported, the segment represented 89.2% of net sales. Revenue in the segment increased 8.6% to $ 31.42 billion on a year-on-year basis.
However, it is very encouraging to note that, for the quarter to be reported, Zacks's consensus estimate for unit revenue was $ 31.92 billion, reflecting an annual increase of 2.5%.
Cardinal Health, Inc. Price and EPS Surprise
Cardinal Health, Inc. EPS Prices and Surprises | Appointment of Cardinal Health, Inc.
Other factors that play a role
Cardinal Health expects to see important contributions from the medical unit. For investor advice, this segment produces products such as cloth, disposable gowns and surgical clothing, surgical examination and gloves, etc., which are likely to increase sales in the quarter.
In the last quarter reported, this unit contributed 10.8% to net sales. Sales in the segment increased 2.1% YoY to $ 3.80 billion.
For the quarter to be reported, the Zacks Consensus Calculation for unit revenue is $ 4.08 billion, reflecting a year-on-year increase of 1%.
However, Cardinal Health's weak expectations about the inspection glove segment are worrying. It should be noted that in the last quarter it was reported, basic product prices, inflation and supply disruptions created winds towards the segment.
What does our model say?
According to our proven model, an action must have a positive ESP and Zacks Rating # 1 (Strong Purchase), 2 (Buy) or 3 (Hold) to offer a positive income surprise in the quarter. However, this does not happen here.
ESP Income: Cardinal Health has ESP 0.00%. You can find the best stocks to buy or sell before being informed with our ESP income filter.
Zacks Ranking: Cardinal Health brings # 3 Rank from Zacks.
Please note that we advise you that shares with Zacks Ranking # 4 (Selling) or 5 (Strong Selling) are included in earnings announcements, especially when companies see a revised negative estimate.
The story continues
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