# Cardinal Health Inc. (CAH) — Financial Analysis

**Exchange:** NYSE  
**Coverage as of:** 2026-Q2  
**Updated:** 2026-05-29  
**Tier:** Free primer (step 2 of 19)  
**Sibling pages:** /stocks/CAH/thesis · /stocks/CAH/memo

## Financial Snapshot

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source: coverage-next-full | ticker: CAH | step: "04" | created: 2026-05-29
---

### Step 04 — Financial Snapshot: Cardinal Health (CAH)

#### Important Notes on Financial Reporting

1. **Fiscal Year Convention**: CAH FY ends June 30. FY2024 = July 2023 – June 2024.
2. **GAAP vs. Non-GAAP**: Cardinal Health's management and investor community focus on **non-GAAP (adjusted) metrics** that exclude opioid litigation charges, amortization of intangibles, restructuring, and other one-time items. Both are presented below.
3. **Divestiture effects**: The sale of at-Home Solutions in FY2023 and other divestitures affect comparability; FY2022 and FY2023 revenue bases are not fully comparable to FY2024.
4. **GAAP operating income is heavily impacted** by opioid litigation accruals in FY2022 and FY2023.

#### Income Statement Summary (FY2022–FY2024, Fiscal Year Ended June 30)

| Metric | FY2022 | FY2023 | FY2024 |
|--------|--------|--------|--------|
| Total Revenue | ~$181B | ~$205B | ~$227B |
| Gross Profit | ~$4.8B | ~$5.4B | ~$6.2B |
| Gross Margin | ~2.6% | ~2.6% | ~2.7% |
| GAAP Operating Income | ~($1.0B) | ~$0.5B | ~$2.1B |
| Non-GAAP (Adj.) Operating Income | ~$1.9B | ~$2.1B | ~$2.4B |
| Non-GAAP Adj. Operating Margin | ~1.0% | ~1.0% | ~1.1% |
| GAAP Net Income (Loss) | ~($932M) | ~$237M | ~$1.6B |
| Non-GAAP Adj. EPS (diluted) | ~$5.24 | ~$6.72 | ~$7.85 |
| GAAP EPS (diluted) | ~($3.37) | ~$0.87 | ~$5.82 |

Key observations:
- Revenue growth of ~10–12% annually driven by pharmaceutical price inflation + specialty volume + GLP-1 drugs
- FY2022 GAAP figures reflect large opioid litigation charges (~$1.9B pre-tax)
- Non-GAAP adjusted EPS growth ~20% from FY2022 to FY2024 reflects Medical turnaround, buybacks, and operating leverage
- Non-GAAP Adj. EPS is the primary management incentive and market valuation metric

#### Segment Operating Income

| Segment | FY2022 | FY2023 | FY2024 |
|---------|--------|--------|--------|
| Pharma & Specialty (Non-GAAP Adj. OI) | ~$1.5B | ~$1.7B | ~$2.0B |
| Medical / GMPD (Non-GAAP Adj. OI) | ~$40M | ~$85M | ~$280M |
| Corporate / Other | ~($350M) | ~($330M) | ~($310M) |
| Total Non-GAAP Adj. OI | ~$1.9B | ~$2.1B | ~$2.4B |

Medical segment recovery is the key earnings growth driver: from ~$40M to ~$280M adjusted operating income in two years.

#### Free Cash Flow

| Metric | FY2022 | FY2023 | FY2024 |
|--------|--------|--------|--------|
| Operating Cash Flow | ~$1.9B | ~$2.2B | ~$2.6B |
| Capital Expenditures | ~($550M) | ~($450M) | ~($400M) |
| Free Cash Flow | ~$1.4B | ~$1.8B | ~$2.2B |
| FCF / Non-GAAP Adj. Net Income | ~100–110% | ~95–105% | ~95–105% |

FCF consistently approximates adjusted earnings. The working capital model (positive float) supports cash generation.

Note: FY2022 and FY2023 FCF benefited from opioid settlement payments being classified differently (below operating income per GAAP). Actual economic cash cost includes ~$500–600M/year in opioid settlement payments.

#### Key Non-GAAP Adjusted EPS Progression

| FY | Adj. EPS (Diluted) | YoY Growth | Notes |
|----|-------------------|------------|-------|
| FY2020 | ~$5.00 | — | Pre-opioid settlement accruals |
| FY2021 | ~$5.73 | +15% | COVID PPE boost |
| FY2022 | ~$5.24 | -9% | Medical margin collapse begins |
| FY2023 | ~$6.72 | +28% | Medical recovery + pharma growth |
| FY2024 | ~$7.85 | +17% | Continued turnaround + buybacks |
| FY2025E | ~$8.50–9.00 | ~8–14% | Buy-side consensus estimates |

#### Adjusted EPS Bridge: Key Drivers

The adjusted EPS growth from FY2022 to FY2024 (~50% total) reflects:
1. **Medical segment turnaround**: ~$0.85 per share impact (from $40M to $280M OI, ~247M shares)
2. **Pharmaceutical segment growth**: Specialty volume + branded price inflation + GLP-1 tailwind (~$0.50/share)
3. **Share count reduction**: Buybacks reduced shares from ~270M (FY2022) to ~235–240M (FY2024) — ~$0.40/share EPS accretion
4. **Interest expense changes**: Net interest income on higher cash balances post-divestitures

#### Balance Sheet Summary (as of June 30, 2024)

| Metric | Approx. |
|--------|---------|
| Cash & Equivalents | ~$4.0–4.5B |
| Total Assets | ~$45–48B |
| Total Debt | ~$5.5–6.0B |
| Net Debt | ~$1.5–2.0B |
| Opioid Settlement Liabilities (remaining) | ~$5.5–6.0B (long-term; $6.4B over 18 years, some paid) |
| Shareholders' Equity | Negative (buybacks exceed book equity) |

Note: CAH reports negative book equity due to aggressive share repurchases eroding retained earnings and paid-in capital. This is common for companies with capital-light, high-cash-flow business models (similar to McDonald's, AbbVie historically). The negative equity does not indicate financial distress.

#### Shareholder Returns (FY2022–FY2024)

| Metric | FY2022 | FY2023 | FY2024 |
|--------|--------|--------|--------|
| Share Repurchases | ~$1.2B | ~$2.0B | ~$2.4B |
| Dividends Paid | ~$500M | ~$500M | ~$520M |
| Total Capital Returned | ~$1.7B | ~$2.5B | ~$2.9B |
| vs. Free Cash Flow | ~120% | ~140% | ~130% |

CAH has returned more than 100% of FCF to shareholders, funded partly by divestiture proceeds.

#### Key Financial Ratios (FY2024)

| Ratio | Value | Notes |
|-------|-------|-------|
| Non-GAAP P/E (at ~$115 stock price) | ~14–15x | On ~$7.85 adj. EPS |
| EV/EBITDA | ~10–12x | Enterprise value ~$28–30B |
| FCF Yield | ~7–8% | On ~$27B market cap |
| Dividend Yield | ~2.1% | At ~$115 stock price |
| Non-GAAP ROE | Meaningfully positive (on adjusted basis) | Book equity negative per GAAP |
| Net Debt / EBITDA | ~0.5–0.7x | Excluding opioid liabilities |

#### Opioid Settlement: Financial Accounting

| Item | Detail |
|------|--------|
| Total Committed Amount | ~$6.4B over ~18 years (through ~2038) |
| Annual Payment | ~$350–400M/year on average |
| Accounting Treatment | Liability recorded on balance sheet; payments classified as operating activities (GAAP) |
| Non-GAAP Exclusion | Opioid-related charges excluded from adjusted operating income and adjusted EPS |
| Tax Effect | Payments are deductible; effective after-tax cost ~$260–320M/year |

This is a significant but known, scheduled liability. The market has largely priced it in, and CAH's free cash flow is sufficient to service payments without financial stress.

## Deeper Financial Analysis

The fundamental tier ($1.00) adds 8 dimensions not included here:

- Revenue Breakdown — segment revenue, geographic mix, product-line margins
- Financial Trends — QoQ momentum, leading indicators, inflection points
- Balance Sheet — debt structure, dilution risk, working capital dynamics
- Capital Allocation — ROIC, buyback cadence, reinvestment efficiency
- Earnings Analysis — beats/misses, guidance vs actuals, transcript highlights
- Competitive Positioning — market share, pricing power, peer benchmarks
- Industry Context — TAM, sector tailwinds/headwinds, regulatory backdrop

**API endpoint:** GET /api/v1/research/CAH/fundamental

## Navigation

- Overview: /stocks/CAH
- Financials (this page): /stocks/CAH/financials
- Thesis: /stocks/CAH/thesis
- Investment Memo: /stocks/CAH/memo
- Coverage universe: /stocks