📊 CAH Key Takeaways
Is Cardinal Health Inc. (CAH) a Good Investment?
Cardinal Health exhibits concerning financial deterioration with negative stockholders' equity of $2.9B, indicating the company is technically insolvent from an equity perspective. Despite maintaining reasonable operational cash flow of $1.7B, the combination of razor-thin margins (0.7% net margin), declining revenue (-1.9% YoY), and severely strained liquidity ratios (0.91x current ratio) suggests structural operational challenges in the wholesale drug distribution sector. The negative equity position raises substantial questions about long-term sustainability and financial flexibility.
Cardinal Health shows resilient core fundamentals through solid operating cash flow, positive free cash flow, and adequate interest coverage despite operating in a structurally low-margin distribution business. However, revenue declined year over year, net income was essentially flat, liquidity is tight, and negative stockholders' equity materially weakens the balance-sheet profile. The business appears fundamentally stable rather than high-quality growth, supporting a neutral view.
Why Buy Cardinal Health Inc. Stock? CAH Key Strengths
- Positive operating cash flow of $1.7B demonstrates ability to generate cash from operations
- Solid free cash flow of $1.4B after capex provides some financial cushion for debt service
- Interest coverage ratio of 8.2x indicates current debt obligations are manageable from an operational standpoint
- Maintains $2.8B in cash reserves providing short-term liquidity buffer
- Consistent cash generation with $1.66B operating cash flow and $1.42B free cash flow
- Interest coverage of 8.2x indicates debt service remains manageable
- EPS growth was strong and profitability remained positive despite a slight revenue decline
CAH Stock Risks: Cardinal Health Inc. Investment Risks
- Negative stockholders' equity of -$2.9B signals the company is technically insolvent and equity investors have negative book value
- Liquidity crisis indicators: current ratio of 0.91x and quick ratio of 0.44x both below safe thresholds, suggesting potential working capital stress
- Revenue declining 1.9% YoY with extremely thin net margins of 0.7%, leaving minimal operational flexibility or cushion for disruptions
- High long-term debt of $8.3B relative to equity base creates refinancing risk and limits financial flexibility
- Structural profitability challenges with gross margin of only 3.6% in a capital-intensive wholesale distribution business
- Extremely thin margins leave little room for execution errors, pricing pressure, or cost inflation
- Negative stockholders' equity and $8.35B of long-term debt weaken financial flexibility
- Current ratio of 0.91x and quick ratio of 0.44x point to tight near-term liquidity
Key Metrics to Watch
- Stockholders' equity trend - critical to monitor if company can return to positive equity or if losses continue
- Revenue growth stabilization - must reverse negative trend to demonstrate business stability
- Operating cash flow sustainability - any decline would exacerbate liquidity concerns
- Current ratio and working capital position - deterioration would indicate imminent liquidity crisis
- Debt refinancing ability and covenant compliance - given negative equity, lender willingness to extend credit becomes paramount
- Operating margin and free cash flow conversion
- Revenue trend and balance-sheet improvement, especially equity and liquidity ratios
Cardinal Health Inc. (CAH) Financial Metrics & Key Ratios
💡 AI Analyst Insight
The relatively thin 1.1% FCF margin may limit capital allocation flexibility. The current ratio below 1.0x warrants monitoring of short-term liquidity.
CAH Profit Margin, ROE & Profitability Analysis
CAH vs Market Sector: How Cardinal Health Inc. Compares
How Cardinal Health Inc. compares to Market sector averages
Sector benchmarks are approximate industry averages. Actual sector performance may vary.
Is Cardinal Health Inc. Stock Overvalued? CAH Valuation Analysis 2026
Based on fundamental analysis, Cardinal Health Inc. has mixed fundamental signals relative to the Market sector in 2026.
Note: This is a fundamental analysis based on SEC filings. For P/E ratio, price targets, and market-based valuation, consult financial data providers. This is not investment advice.
Cardinal Health Inc. Balance Sheet: CAH Debt, Cash & Liquidity
CAH Revenue & Earnings Growth: 5-Year Financial Trend
5-Year Trend Summary: Cardinal Health Inc.'s revenue has grown significantly by 40% over the 5-year period, indicating strong business expansion. The most recent EPS of $1.26 reflects profitable operations.
CAH Revenue Growth, EPS Growth & YoY Performance
CAH Quarterly Earnings & Performance
| Quarter | Revenue | Net Income | EPS |
|---|---|---|---|
| Q2 2026 | $55.3B | $400.0M | N/A |
| Q1 2026 | $52.3B | $416.0M | $1.70 |
| Q3 2025 | $54.9B | $261.0M | N/A |
| Q2 2025 | $55.3B | $356.0M | N/A |
| Q1 2025 | $52.3B | -$12.0M | $-0.05 |
| Q3 2024 | $50.5B | $258.0M | N/A |
| Q2 2024 | $51.5B | -$20.0M | N/A |
| Q1 2024 | $49.6B | $5.0M | $0.02 |
Data sourced from SEC EDGAR 10-Q quarterly filings. Figures may represent quarterly or cumulative values.
Cardinal Health Inc. Dividends, Buybacks & Capital Allocation
CAH SEC Filings: Latest 10-K & 10-Q Analysis
Access official SEC EDGAR filings for Cardinal Health Inc. (CIK: 0000721371)
📋 Recent SEC Filings
❓ Frequently Asked Questions about CAH
What is the AI rating for CAH?
Cardinal Health Inc. (CAH) has a Combined AI Rating of SELL from Claude (SELL) and ChatGPT (HOLD) with 76% combined confidence, based on fundamental analysis of SEC EDGAR filings.
What are CAH's key strengths?
Claude: Positive operating cash flow of $1.7B demonstrates ability to generate cash from operations. Solid free cash flow of $1.4B after capex provides some financial cushion for debt service. ChatGPT: Consistent cash generation with $1.66B operating cash flow and $1.42B free cash flow. Interest coverage of 8.2x indicates debt service remains manageable.
What are the risks of investing in CAH?
Claude: Negative stockholders' equity of -$2.9B signals the company is technically insolvent and equity investors have negative book value. Liquidity crisis indicators: current ratio of 0.91x and quick ratio of 0.44x both below safe thresholds, suggesting potential working capital stress. ChatGPT: Extremely thin margins leave little room for execution errors, pricing pressure, or cost inflation. Negative stockholders' equity and $8.35B of long-term debt weaken financial flexibility.
What is CAH's revenue and growth?
Cardinal Health Inc. reported revenue of $129.6B.
Does CAH pay dividends?
Cardinal Health Inc. pays dividends, with $251.0M distributed to shareholders in the trailing twelve months.
Where can I find CAH SEC filings?
Official SEC filings for Cardinal Health Inc. (CIK: 0000721371) including 10-K, 10-Q, and 8-K reports are available on SEC EDGAR.
What is CAH's EPS?
Cardinal Health Inc. has a diluted EPS of $1.88.
How is the AI analysis conducted?
Two independent AI systems — Claude (Anthropic) and ChatGPT (OpenAI) — analyze SEC EDGAR filings including 10-K annual reports and 10-Q quarterly reports. Each AI evaluates financial health, profitability ratios, balance sheet strength, and growth metrics. The combined rating reflects both perspectives for balanced insights.
Is CAH a good stock to buy right now?
Based on our AI fundamental analysis in April 2026, Cardinal Health Inc. has a SELL rating with 76% confidence. Review the strengths and risks sections above before making a decision. This is not investment advice.
Is CAH stock overvalued or undervalued?
Valuation metrics for CAH: ROE of N/A (sector avg: 15%), net margin of 0.7% (sector avg: 12%). Compare these metrics with sector averages to assess valuation.
Should I buy CAH stock in 2026?
Our dual AI analysis gives Cardinal Health Inc. a combined SELL rating for 2026. Revenue is data pending, with profitability at or below sector average. Always conduct your own research.
What is CAH's free cash flow?
Cardinal Health Inc.'s operating cash flow is $1.7B, with capital expenditures of $239.0M. FCF margin is 1.1%.
How does CAH compare to other Market stocks?
Vs Default sector averages: Net margin 0.7% (avg: 12%), ROE N/A (avg: 15%), current ratio 0.91 (avg: 1.8).