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    Surging Sales, Falling EPS, and Big Buybacks Could Be A Game Changer For McKesson (MCK)

    Simply Wall St·08/13/2026 05:27:01
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    • In early August 2026, McKesson Corporation reported first-quarter sales of US$105.38 billion, up from US$97.83 billion a year earlier, while net income fell to US$614 million and diluted EPS from continuing operations declined to US$5.15 from US$6.25.
    • Over the same quarter, McKesson repurchased 3,600,000 shares for US$2,896.30 million, bringing total buybacks under its long-running program to 70,100,000 shares for US$23,475.49 million, significantly shrinking its share count and reshaping capital allocation.
    • Next, we’ll examine how McKesson’s combination of higher sales but lower earnings, alongside substantial buybacks, affects its broader investment narrative.

    Find 49 companies with promising cash flow potential yet trading below their fair value.

    McKesson Investment Narrative Recap

    To own McKesson, you need to be comfortable with a low margin distribution business that depends on scale, execution and disciplined capital allocation. The latest quarter’s higher sales but lower earnings do not appear to materially change the near term focus on policy risk around drug pricing or competitive pressure from vertically integrated healthcare players.

    The most relevant update here is McKesson’s completion of its long running US$29,000 million buyback authorization, with 70,100,000 shares retired in total. This sustained repurchase activity, alongside a steady dividend, reinforces how management is currently balancing returning cash to shareholders with reinvesting in the wholesale and technology platforms that underpin its key catalysts.

    Yet, while this capital return story is appealing, investors should still be aware that rising regulatory pressure on drug pricing could...

    Read the full narrative on McKesson (it's free!)

    McKesson's narrative projects $502.2 billion revenue and $6.3 billion earnings by 2029. This requires 6.9% yearly revenue growth and about a $1.7 billion earnings increase from $4.6 billion today.

    Uncover how McKesson's forecasts yield a $980.80 fair value, a 12% upside to its current price.

    Exploring Other Perspectives

    MCK 1-Year Stock Price Chart
    MCK 1-Year Stock Price Chart

    Four members of the Simply Wall St Community currently value McKesson between US$827.49 and US$1,682.90 per share, showing a wide spread of expectations. Set against the policy and pricing risks highlighted earlier, this divergence underlines how differently you might weigh potential margin pressure and should encourage you to consider several viewpoints before deciding how McKesson fits into your portfolio.

    Explore 4 other fair value estimates on McKesson - why the stock might be worth as much as 92% more than the current price!

    Decide For Yourself

    Don't just follow the ticker - dig into the data and build a conviction that's truly your own.

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    This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.