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HEALTHCARE: McKesson (MCK: A3/BBB+): Reduced Profit Guidance

HEALTHCARE

Small negative: More of an equity story

  • MCK equity fell -9.8% yesterday and is now -19.3% off of recent highs.
  • The company is guiding for EPS of $6.70 - $7.00 vs consensus of $7.37
  • MCK is up 324% in 5yrs with investors pricing in continued stellar growth so it had room to fall.

In corporate news, the company is shifting its focus to Oncology and Biopharma Platforms. The margin in this business is much greater than that for the core US Pharma (1.14%).
Prescription Tech 17.97% margin
Medical-Surgery 7.59% margin

MCK was able to issue 5yr $500 at T+72 last night and announced the sale of 2 Canadian businesses for an undisclosed sum.

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