CAH
Cardinal Health
Dividend / Cash flow
★ Quality 74/100Price today
$228.58
what the market pays
Worth
$171.41
calculated cycle value
Price is 33% above its value
charlieapp.co
A monopoly position
This company has a competitive advantage so strong that its rivals find it practically impossible to replicate.
Price vs Intrinsic Value
The line is the price month by month; the green band marks when it's undervalued (−20% off value). When the price drops in there, the discount is real, not opinion.
Where does the value come from?
Established business paying dividends
$188.36
per share
How it's calculated
Net cash in the bank
cash minus financial debt, per share
Total calculated value
business + cash
How many times the cash flow
Dividend / Cash flow · vs 45 peers
You pay 32.1x times this business's cash flow; its sector median is 25.8x.
23% above what Charlie thinks it's worth (24.6x) — you're overpaying, sector or no sector.
Why does Charlie give it 24.6x?
The multiple is how many times its cash flow the business is worth.
An average business of its kind is worth 25.8x. This one drops from there:
4% margin. it earns on volume, not margin; it can't raise prices at will.
Monopoly position. an edge so strong that replicating it would take decades.
Reinvests at high returns. every dollar it reinvests earns far above its cost.
That's why it's worth 24.6x, less than the 25.8x average.
Why Overvalued?
Its free cash flow is $7.64/share × 24.6x multiplier minus $16.95 in negative net cash = $171.41 in intrinsic value. Today's price of $228.58 is 25% above the calculated value — the market is paying a premium over what the model sees as fair.
The price is 33% above the calculated value. You're paying more than it's worth.
Buying here lowers your expected return and wipes out the safety margin.
The next reasonable entry zone starts at $162.84.
At what price would buying make sense?
Entry zones
🟢 Undervalued
≤$137.13
-20% off Value
🟡 Discounted
≤$162.84
-5% off Value
🔴 Today
$228.58
-25% Valor
Overvalued
The market prices it too high versus what the business makes. Patience pays off here.
“Time is the friend of the wonderful company, the enemy of the mediocre.”
— Warren Buffett
Model updated · July 2026
The business
Cardinal mueve casi todas las medicinas de EE.UU. y se queda cuatro centavos por dólar.
Cardinal Health es el mayorista que lleva medicamentos y material médico desde los fabricantes hasta farmacias, hospitales y clínicas. Gana con un margen mínimo sobre un volumen enorme: $222.6B de ventas dejan apenas 4% de margen bruto. También fabrica y distribuye productos médicos propios.
Solo tres empresas reparten casi toda la distribución farmacéutica de EE.UU.; construir esa red logística y esos contratos toma décadas. Los márgenes son tan finos que nadie nuevo quiere entrar a competir por centavos. La escala es la barrera: cuanto más volumen mueves, más barato mueves cada caja.
Revenue history
From $162.5B to $222.6B in 4 years. The business grows steadily.
Where each $100 of sales goes
Revenue $222.6B · FY2025
Of every $100 in sales, $99 goes to costs and operations; $0.7 is left as net profit (0.7% margin).
Catalysts and risks
Acuerdo de opioides (~$6B pagados a plazos) cierra un litigio que pesaba sobre la acción.
Compras en oncología y especialidades (GI Alliance, Integrated Oncology Network) para migrar hacia servicios de mayor margen.
Casi 40 años seguidos subiendo el dividendo, con recompras de acciones sostenidas.
Pérdida del contrato con OptumRx recortó ventas en el FY2025 y muestra la concentración de clientes.
Margen neto por debajo del 1%: cualquier tropiezo operativo se nota de inmediato.
Reforma de precios de medicamentos en EE.UU. puede apretar aún más al intermediario.
Charlie's note
“Pagas casi 25 veces el flujo libre por un negocio que se queda con cuatro centavos de cada dólar que mueve. El foso de tres jugadores es real y el dividendo es de fiar, pero para crecer 8% ese múltiplo no te regala margen de error: el mercado ya descontó que todo salga bien.”
Analysis · July 2026
So when would be a good price for Cardinal Health?
By our calculation, not yet. We will email you the day it drops to $162.84 — so you do not have to keep checking.
🔔 Email meFree · no card
Charlie informs, it doesn't advise. No information should be taken as a recommendation to buy or sell.