McKesson's Stock Rises Despite Q3 Earnings Miss

McKesson Corporation's shares show resilience with a slight increase following weaker-than-expected Q3 earnings, including EPS of $8.03. Positive revenue growth from key segments and a raised earnings forecast bolster investor confidence.

Date: 22-02-2025

AI Rating: 6

Stock Performance Overview
McKesson Corporation has historically underperformed compared to the broader S&P 500, with a year-on-year gain of only 19.1%, while the S&P 500 rallied nearly 23%. However, a more recent rally in 2025 has seen the stock gain 5.9% compared to the S&P 500's 4% gains.

Earnings Per Share (EPS)
The company reported weaker-than-expected adjusted EPS of $8.03 for Q3 2025 but raised its fiscal 2025 adjusted EPS guidance to between $32.55 and $32.95. Analysts forecast a year-over-year EPS growth of 19.4%, leading to an estimated EPS of $32.77 on a diluted basis for the current fiscal year.

Revenue Growth
Despite the EPS miss, McKesson's revenue showed resilience, reporting $95.3 billion in Q3. Significant revenue growth was driven by the U.S. Pharmaceutical segment, which achieved a 19% growth aided by a $32 billion strategic partnership. Furthermore, the Prescription Technology Solutions segment experienced a 14% revenue growth.

Market Sentiment
The stock has received a positive consensus rating from analysts with a "Strong Buy" categorization based on 16 analysts, which is an increase in bullish ratings from three months ago, further supporting investor confidence.

Overall, the positive segments of revenue growth and EPS guidance raised investor sentiment despite the initial disappointment in Q3 earnings.

Stocks: MCK