CAH
Cardinal Health, Inc.
$233.66
Stable Earnings Power
80%
P/Adj-EPS × Normalized Multiple
Strong
·
Conviction
Overvalued
Trading 53.7% above fair value
You pay
$233.66
Bear
$121.65
Fair
$152.06
Bull
$182.48
Bear
$121.65
-47.9%
$7.24 × 12x P/E
Fair
$152.06
-34.9%
$7.24 × 15x P/E
Bull
$182.48
-21.9%
$7.24 × 18x P/E
Key Value Driver
Normalized P/E multiple (15x base case)
Implied Market Multiple
32.3x
Summary
Our base-case estimate uses a valuation based on adjusted earnings per share and a normalized price-to-earnings multiple. We then blend that result with the average analyst price target of $253.38 from 33 analysts, using a 30% weight on analyst consensus. That produces an estimated intrinsic value of $152.06 per share.
Warnings
Dividend-based valuation: $29.55 (below our primary estimate by 73%). Large gaps may signal the dividend doesn't reflect full earning power.
Wall Street's average price target is $253.38 (from 33 analysts). Our estimate is 57% below the consensus -- consider that gap carefully.
Key Risks
- Growth DCF inappropriate — terminal value assumptions dominate
- EV/EBITDA misleading for regulated businesses where capex is mandated
- Regulatory risk is a fat tail not visible in normal multiples