CAH
Cardinal Health, Inc.
$237.57
Stable Earnings Power
80%
P/Adj-EPS × Normalized Multiple
Strong
·
Conviction
Overvalued
Trading 105.0% above fair value
You pay
$237.57
Bear
$92.70
Fair
$115.88
Bull
$139.06
Bear
$92.70
-61.0%
$7.23 × 13x P/E
Fair
$115.88
-51.2%
$7.23 × 16x P/E
Bull
$139.06
-41.5%
$7.23 × 19x P/E
Adjust Assumptions
16.0x
7.23$
Key Value Driver
Normalized P/E multiple (16x base case)
Implied Market Multiple
32.9x
Analyst Consensus (External Reference)
Never blended into the bear/base/bull estimates above.
Average Target (33 analysts)
$273.22
Divergence from AlphaVal
58%
Summary
Applying a 16x P/E to adjusted EPS of $7.23, the base-case value is $115.88 per share. DDM cross-check: $29.62.
Warnings
Dividend-based valuation: $29.62 (below our primary estimate by 74%). Large gaps may signal the dividend doesn't reflect full earning power.
Wall Street's average price target is $273.22 (from 33 analysts). Our estimate is 58% 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