Upside case
Bull case
$775+4.3%
MCK would need investors to value it at roughly 20x earnings — about 1x more generous than today's 19x forward P/E. That requires meaningful multiple expansion on top of continued earnings growth.
Analysis OverviewBuyUpdated May 1, 2026
McKesson Corporation (MCK) Stock Analysis
Wall Street verdict, consensus price target, and analyst rating breakdown — everything needed to frame the risk/reward at today's price.
Analyst consensus
Buy
Covering
31
analysts
25 bullish · 0 bearish · 31 covering MCK
Strong Buy
1
Buy
24
Hold
6
Sell
0
Strong Sell
0
Consensus Target
$1007
+35.3% vs today
Scenario Range
$287 – $775
Model bear to bull value window
Coverage
31
Published analyst ratings
Valuation Context
19.1x
Forward P/E · Market cap $91.1B
MCK price targets
Three scenarios for where MCK stock could go
Current
~$744
Confidence
75 / 100
Updated
May 1, 2026
Where we are now
Current · $744
Bear
$287
Base
$1653
Bull
$775
Market caseClosest to today
Base case
$1653+122.3%
At 42x on FY1 earnings, the base case reflects a reasonable but not stretched valuation. It prices in continued growth without assuming an exceptional setup.
Stress case
Bear case
$287-61.4%
If investor confidence fades or macro conditions deteriorate, a 12x multiple contraction could push MCK down roughly 61% from where it trades now.
Not financial advice. Model confidence reflects internal scenario assumptions, not a guarantee of returns. Past performance does not predict future results.
McKesson Corporation
MCK · NYSEHealthcareMedical - DistributionMarch year-end
McKesson is a healthcare supply chain and services company that distributes pharmaceuticals and medical supplies across the U.S. and internationally. It generates most of its revenue from pharmaceutical distribution—primarily through its U.S. Pharmaceutical segment—with additional income from medical-surgical supplies, technology solutions, and international operations. The company's competitive advantage lies in its massive scale and integrated logistics network, which creates significant barriers to entry in the highly regulated healthcare distribution market.
Market Cap
$91.1B
Revenue TTM
$398.0B
Net Income TTM
$4.3B
Net Margin
1.1%
MCK Revenue and Earnings Performance
Quarterly beat-or-miss track record against analyst estimates, plus forward revenue and EPS outlook for the next two fiscal years.
EPS Beat Rate
83%Exceptional
12 quarters tracked
Revenue Beat Rate
58%Exceptional
vs consensus estimates
Avg EPS Surprise
+4.5%
above Street consensus
Beat / Miss Record
BeatMissLeft = EPS · Right = Revenue
Q2 2025
Q3 2025
Q4 2025
Q1 2026
Last 4 Quarters
EPS beats: 4 of 4Q2 2025
EPS
$10.12/$9.83
Revenue
$90.8B/$94.3B
Q3 2025
EPS
$8.26/$8.14
Revenue
$97.8B/$96.2B
Q4 2025
EPS
$9.86/$9.03
Revenue
$103.2B/$104.1B
Q1 2026
EPS
$9.34/$9.17
Revenue
$106.2B/$105.8B
| Quarter | EPS (Actual / Est) | EPS Surprise | Revenue (Actual / Est) | Rev Surprise |
|---|---|---|---|---|
| Q2 2025 | $10.12/$9.83 | +3.0% | $90.8B/$94.3B | -3.7% |
| Q3 2025 | $8.26/$8.14 | +1.5% | $97.8B/$96.2B | +1.7% |
| Q4 2025 | $9.86/$9.03 | +9.2% | $103.2B/$104.1B | -0.9% |
| Q1 2026 | $9.34/$9.17 | +1.9% | $106.2B/$105.8B | +0.3% |
FY1–FY2 Estimates
Revenue Outlook
FY1
$437.8B
+10.0% YoY
FY2
$493.8B
+12.8% YoY
EPS Outlook
FY1
$44.68
+27.3% YoY
FY2
$57.16
+27.9% YoY
Trailing FCF (TTM)$10.1B
FCF Margin: 2.5%
Next Earnings
May 7, 2026
Expected EPS
$11.56
Expected Revenue
$101.3B
MCK beat EPS estimates in 4 of 4 tracked quarters. A perfect track record raises the bar for the upcoming report.
MCK Revenue Breakdown by Segment
Product and geographic revenue mix from the latest annual disclosure, with year-over-year growth by segment.
Latest disclosure
FY 2025
Total disclosed revenue $359.0B
Product Mix
Latest annual revenue by segment or product family
U.S. Pharmaceutical Segment
91.3%
+17.6% YoY
Tap, hover, or focus a slice to inspect segment detail.
Geographic Mix
Latest annual revenue by reported region
Segment breakdown not available for this company.
U.S. Pharmaceutical Segment is the largest disclosed segment at 91.3% of FY 2025 revenue, up 17.6% YoY.
MCK Valuation Snapshot
Current multiples compared to the S&P 500, the company's sector, and its own five-year average.
Relative Value Signal
Significantly Undervalued
Fair value est. $1293 — implies +58.8% from today's price.
Upside to Fair Value
58.8%
potential upside
Deep DiscountFair ValueVery Expensive
vs S&P 500 Trailing P/E
MCK
28.9x
vs
S&P 500
25.2x
+15% premium
vs Healthcare Trailing P/E
MCK
28.9x
vs
Healthcare
22.1x
+31% premium
vs MCK 5Y Avg P/E
Today
28.9x
vs
5Y Average
26.7x
+8% premium
Forward PE
19.1x
S&P 500
19.1x
0%
Healthcare
19.0x
+0%
5Y Avg
—
—
Trailing PE
28.9x
S&P 500
25.2x
+15%
Healthcare
22.1x
+31%
5Y Avg
26.7x
+8%
PEG Ratio
0.74x
S&P 500
1.75x
-58%
Healthcare
1.52x
-51%
5Y Avg
—
—
EV/EBITDA
18.5x
S&P 500
15.3x
+21%
Healthcare
14.1x
+31%
5Y Avg
13.0x
+43%
Price/FCF
17.4x
S&P 500
21.3x
-18%
Healthcare
18.7x
-7%
5Y Avg
13.5x
+29%
Price/Sales
0.3x
S&P 500
3.1x
-92%
Healthcare
2.8x
-91%
5Y Avg
0.2x
+31%
Dividend Yield
0.36%
S&P 500
1.88%
-81%
Healthcare
1.40%
-74%
5Y Avg
0.58%
-37%
| Metric | MCK | S&P 500 | Healthcare | 5Y Avg MCK |
|---|---|---|---|---|
| Forward PE | 19.1x | 19.1x | 19.0x | — |
| Trailing PE | 28.9x | 25.2x+15% | 22.1x+31% | 26.7x |
| PEG Ratio | 0.74x | 1.75x-58% | 1.52x-51% | — |
| EV/EBITDA | 18.5x | 15.3x+21% | 14.1x+31% | 13.0x+43% |
| Price/FCF | 17.4x | 21.3x-18% | 18.7x | 13.5x+29% |
| Price/Sales | 0.3x | 3.1x-92% | 2.8x-91% | 0.2x+31% |
| Dividend Yield | 0.36% | 1.88% | 1.40% | 0.58% |
MCK trades above S&P 500 benchmarks on 2 of 6 measured multiples — is elevated on some multiples, but competitive on others — a mixed valuation picture.
Forward P/E and PEG reflect analyst consensus estimates. Historical averages use trailing ratios where forward data is unavailable.S&P 500 and sector benchmarks both use trailing median P/E — similar readings indicate the broader index and sector are priced alike.
Open valuation toolMCK Financial Health
Verdict
Adequate
MCK 540.6% ROIC signals a durable competitive advantage — returns 3.8% of market cap to shareholders annually.
Cash Engine
Revenue, margins, and cash generation
Revenue (TTM)
Trailing-twelve-month sales base
$398.0B
Revenue Growth
TTM vs prior year
+15.5%
Gross Margin
Gross profit as a share of revenue
3.4%
Operating Margin
Operating income divided by revenue
1.3%
Net Margin
Net income divided by revenue
1.1%
EPS (TTM)
Diluted earnings per share, trailing twelve months
$35.08
Free Cash Flow (TTM)
Cash generation after capex
$10.1B
FCF Margin
FCF as share of revenue — the primary cash quality signal
2.5%
Capital Quality
ROIC, leverage, and debt serviceability
ROIC
Return on invested capital — primary competitive quality signal
540.6%
ROA
Return on assets, trailing twelve months
5.3%
Cash & Equivalents
Liquid assets on the balance sheet
$5.7B
Net Debt
Total debt minus cash
$1.7B
Debt Serviceability
Net debt as a multiple of annual free cash flow
0.2× FCF
~0.2 years to full repayment at current FCF run-rate
ROE
Return on equity, trailing twelve months
—
Shareholder Returns
How capital is returned to owners
Total shareholder yield
3.8%
Dividend
0.4%
Buyback
3.5%
Share Repurchases
Trailing buyback outflow — dollar magnitude of capital returned
$3.1B
Dividend / Share
Annualized trailing dividend per share
$2.69
Payout Ratio
Share of earnings distributed as dividends
10.5%
Shares Outstanding
Declining as buybacks retire shares
122M
All figures from the trailing twelve months. ROIC uses invested capital (equity + net debt).
Open full ratios pageMCK Stock Risk Factors
Key factors that could pressure the stock price, compress the multiple, or weigh on future results.
AI analysis · updated April 11, 2026
High Risk
Legal & Regulatory Issues
McKesson faces extensive healthcare litigation, including opioid distribution liabilities and allegations of misleading investors on generic drug pricing. Ongoing anti‑trust investigations could force divestitures or impose fines that materially reduce earnings.
Medium
Operational & Cost Pressures
The company’s low‑margin model is highly sensitive to supplier price inflation. Using LIFO, drug price changes directly hit gross profit, and even a modest rise in cost of sales could materially lower the target price.
Medium
Market & Industry Dynamics
Potential cuts to Medicare and Medicaid reimbursement rates, coupled with intensifying competition, threaten revenue growth. Declining gross margins signal core competitive challenges despite top‑line expansion.
Medium
Strategic Execution & Divestitures
McKesson’s separation of its Medical‑Surgical Solutions segment carries execution risk, including operational disruptions and unforeseen costs that could impact the core business.
Lower
Supply Chain & Product Quality
The vast distribution network introduces complexities; non‑conforming pharmaceutical or medical products could lead to recalls or regulatory penalties, affecting revenue and reputation.
These are risk mechanisms, not predictions. The key question is which would force a cut to earnings estimates or a lower multiple than the market currently prices in.
Why MCK Stock Could Outperform
Structural drivers behind the upside case and why the stock could outperform over the next 12 months.
AI analysis · updated April 11, 2026
Consistent EPS Beat
McKesson has repeatedly outperformed analyst forecasts, reporting $9.34 EPS in Q3 2025 versus expectations. This trend underscores operational efficiency and strong earnings momentum.
Oncology & Biopharma Revenue Surge
The oncology and multispecialty segment grew 37% in revenue and 57% in operating profit in Q3, driven by expanding value‑based care and GLP‑1 distribution.
Robust FY 2025 Revenue Growth
Fiscal year 2025 revenue rose 16.22% to $359.05 billion, while analysts project an 11.81% earnings increase next year. Long‑term EPS growth averages 17.17%.
Strategic Capital Allocation Post‑Exit
McKesson exited European markets, selling its Norwegian businesses to reallocate capital toward high‑growth oncology and biopharma services.
Strong ROIC & Dividend Growth
The company boasts a 28.37% ROIC, reflecting efficient capital use, and has raised its dividend for 17 consecutive years, with $2.5 billion in planned share repurchases.
A real bull case compounds — each driver matters most when it strengthens margins, supports capital returns, and keeps the company above the market's minimum growth bar simultaneously.
MCK Stock Price Performance
52-week range context and price returns across multiple time horizons. Dividend contribution is shown separately in the Capital Return section.
Current Price
$743.67
52W Range Position
29%
52-Week Range
Current price plotted between the 52-week low and high.
52-Week Low
$637.00
+16.7% from the low
52-Week High
$999.00
-25.6% from the high
1 Month
-13.20%
3 Month
-21.61%
YTD
-9.7%
1 Year
+4.6%
3Y CAGR
+26.4%
5Y CAGR
+32.1%
10Y CAGR
+16.0%
Range context matters because valuation compression and earnings misses rarely hit from the same starting point. A stock already far below its high can still fall, but it is no longer carrying the same embedded optimism as one pressing a fresh peak.
MCK vs Peers
Valuation, growth, and margin comparison against the closest publicly traded peers for this company.
Peer Set
Accurate peer set
Forward PE
19.1x
vs 12.1x median
+57% above peer median
Revenue Growth
+10.0%
vs +3.5% median
+186% above peer median
Net Margin
1.1%
vs 0.7% median
+52% above peer median
| Company | Mkt Cap | Fwd PE | Rev Grw | Margin | Rating | Upside |
|---|---|---|---|---|---|---|
MCK MCK McKesson Corporation | $91.1B | 19.1x | +10.0% | 1.1% | Buy | +35.3% |
CAH CAH Cardinal Health, Inc. | $45.1B | 18.5x | +2.9% | 0.6% | Buy | +30.4% |
HSI HSIC Henry Schein, Inc. | $8.3B | 13.6x | +3.7% | 3.0% | Hold | +19.3% |
CVS CVS CVS Health Corporation | $111.3B | 12.1x | +3.5% | 0.7% | Buy | +9.6% |
CI CI Cigna Corporation | $74.3B | 9.3x | +7.5% | 2.3% | Buy | +16.3% |
OMI OMI Owens & Minor, Inc. | $171M | 2.3x | -26.3% | -39.8% | Hold | +78.6% |
This peer comparison reflects companies with similar business models, product lines, or market positioning, supplemented by industry grouping when direct matches are limited.
MCK Dividend and Capital Return
MCK returns capital mainly through $3.1B/year in buybacks (3.5% buyback yield), with a modest 0.36% dividend — combining for 3.8% total shareholder yield. The dividend has grown for 18 consecutive years.
Dividend SustainableFCF Well Covered
Total Shareholder Yield
3.8%
Dividend + buyback return per year
Buyback Yield
3.5%
Dividend Yield
0.36%
Payout Ratio
10.5%
How MCK Splits Its Return
Buyback 3.5%
Dividend 0.36%Buybacks 3.5%
Dividend Profile
Yield, cadence, and growth quality
Dividend / Share
Trailing annualized cash dividend
$2.69
Growth Streak
Consecutive years of dividend increases
18Y
3Y Div CAGR
14.8%
5Y Div CAGR
13.0%
Ex-Dividend Date
—
Payment Cadence
Semi-Annual
5 payments over the last 12 months
Buyback Engine
How much per-share support comes from repurchases
Repurchases (TTM)
Cash used for buybacks in the latest trailing period
$3.1B
Estimated Shares Retired
4M
Approx. Share Reduction
3.5%
Shares Outstanding
Current diluted share count from the screening snapshot
122M
At 3.5%/year, buybacks mechanically lift EPS even with flat earnings — each remaining share represents a slightly larger piece of the company.
| Year | Div / Share | YoY Grw | BB Yield | Total Yield |
|---|---|---|---|---|
| 2026 | $1.64 | — | — | — |
| 2025 | $3.06 | +15.0% | 3.6% | 4.0% |
| 2024 | $2.66 | +14.7% | 4.2% | 4.6% |
| 2023 | $2.32 | +14.9% | 7.2% | 7.8% |
| 2022 | $2.02 | +13.5% | 7.5% | 8.0% |
FAQ
7 questionsMCK Investor Questions
Common questions answered from live analyst data and company financials.
01Is McKesson Corporation (MCK) stock a buy or sell in 2026?
McKesson Corporation (MCK) is rated Buy by Wall Street analysts as of 2026. Of 31 analysts covering the stock, 25 rate it Buy or Strong Buy, 6 rate it Hold, and 0 rate it Sell or Strong Sell. The consensus 12-month price target is $1007, implying +35.3% from the current price of $744. The bear case scenario is $287 and the bull case is $775.
02What is the MCK stock price target for 2026?
The Wall Street consensus price target for MCK is $1007 based on 31 analyst estimates. The high-end target is $1085 (+45.9% from today), and the low-end target is $966 (+29.9%). The base case model target is $1653.
03Is McKesson Corporation (MCK) stock overvalued in 2026?
MCK trades at 19.1x times forward earnings. The stock's valuation is broadly in line with the broader market. Based on current multiples versus the peer group, the relative model signals significantly undervalued. Whether the stock is over or undervalued ultimately depends on whether consensus earnings estimates are achievable.
04What are the main risks for McKesson Corporation (MCK) stock in 2026?
The primary risks for MCK in 2026 are: (1) Legal & Regulatory Issues — McKesson faces extensive healthcare litigation, including opioid distribution liabilities and allegations of misleading investors on generic drug pricing. (2) Operational & Cost Pressures — The company’s low‑margin model is highly sensitive to supplier price inflation. (3) Market & Industry Dynamics — Potential cuts to Medicare and Medicaid reimbursement rates, coupled with intensifying competition, threaten revenue growth. Each factor has the potential to pressure earnings or compress the stock's valuation multiple.
05What is McKesson Corporation's revenue and earnings forecast?
Analyst consensus estimates MCK will report consensus revenue of $437.8B (+10.0% year-over-year) and EPS of $44.68 (+27.3% year-over-year) for the upcoming fiscal year. The following year, analysts project $493.8B in revenue.
06When does McKesson Corporation (MCK) report its next earnings?
McKesson Corporation is expected to report its next earnings on approximately 2026-05-07. Consensus expects EPS of $11.56 and revenue of $101.3B. Over recent quarters, MCK has beaten EPS estimates 83% of the time.
07How much free cash flow does McKesson Corporation generate?
McKesson Corporation (MCK) generated $10.1B in free cash flow over the trailing twelve months — a free cash flow margin of 2.5%. MCK returns capital to shareholders through dividends (0.4% yield) and share repurchases ($3.1B TTM).