Stock Analysis on Net

McKesson Corp. (NYSE:MCK)

This company has been moved to the archive! The financial data has not been updated since October 27, 2016.

Common Stock Valuation Ratios (Price Multiples) 

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Current Valuation Ratios

McKesson Corp., current price multiples

Microsoft Excel
McKesson Corp. Abbott Laboratories Cigna Group CVS Health Corp. Elevance Health Inc. Humana Inc. Intuitive Surgical Inc. Medtronic PLC UnitedHealth Group Inc.
Selected Financial Data
Current share price (P) $160.50
No. shares of common stock outstanding 226,086,960
Growth rate (g) 17.08%
 
Earnings per share (EPS) $9.99
Next year expected EPS $11.69
Operating profit per share $15.68
Sales per share $844.29
Book value per share (BVPS) $39.47
Valuation Ratios (Price Multiples)
Price to earnings (P/E) 16.07 35.13 17.42 8.57 15.40 14.22 107.33 29.34 24.69
Price to next year expected earnings 13.73 32.88 15.64 8.08 13.69 12.11 94.57 28.82 21.06
Price-earnings-growth (PEG) 0.94 5.11 1.53 1.40 1.23 0.81 7.95 16.01 1.43
Price to operating profit (P/OP) 10.24 31.04 10.54 5.20 12.11 8.82 109.23 20.97 17.08
Price to sales (P/S) 0.19 5.01 0.46 0.20 0.54 0.34 27.09 3.33 1.50
Price to book value (P/BV) 4.07 5.21 1.95 0.94 2.35 2.18 14.50 2.15 6.23

Based on: 10-K (reporting date: 2016-03-31).

If the company price multiple is lower then the price multiple of benchmark then company stock is relatively undervalued.
Otherwise, if the company price multiple is higher then the price multiple of benchmark then company stock is relatively overvalued.


Historical Valuation Ratios (Summary)

McKesson Corp., historical price multiples

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Mar 31, 2016 Mar 31, 2015 Mar 31, 2014 Mar 31, 2013 Mar 31, 2012 Mar 31, 2011
Price to earnings (P/E) 17.21 36.01 32.53 18.40 15.13 17.38
Price to operating profit (P/OP) 10.96 17.91 17.36 10.63 9.88 11.47
Price to sales (P/S) 0.20 0.30 0.30 0.20 0.17 0.19
Price to book value (P/BV) 4.35 6.64 4.82 3.48 3.11 2.89

Based on: 10-K (reporting date: 2016-03-31), 10-K (reporting date: 2015-03-31), 10-K (reporting date: 2014-03-31), 10-K (reporting date: 2013-03-31), 10-K (reporting date: 2012-03-31), 10-K (reporting date: 2011-03-31).

Valuation ratio Description The company
P/E ratio The P/E ratio tells analyst how much an investor in common stock pays per dollar of current earnings. McKesson Corp. P/E ratio increased from 2014 to 2015 but then decreased significantly from 2015 to 2016.
P/OP ratio Because P/E ratio is calculated using net income, the ratio can be sensitive to nonrecurring earnings and capital structure, analysts may use price to operating profit. McKesson Corp. P/OP ratio increased from 2014 to 2015 but then decreased significantly from 2015 to 2016.
P/S ratio An rationale for the P/S ratio is that sales, as the top line in an income statement, are generally less subject to distortion or manipulation than other fundamentals such as EPS or book value. Sales are also more stable than earnings and never negative. McKesson Corp. P/S ratio decreased from 2014 to 2015 and from 2015 to 2016.
P/BV ratio The P/BV ratio is interpreted as an indicator of market judgment about the relationship between a company required rate of return and its actual rate of return. McKesson Corp. P/BV ratio increased from 2014 to 2015 but then decreased significantly from 2015 to 2016.

Price to Earnings (P/E)

McKesson Corp., historical P/E calculation, comparison to benchmarks

Microsoft Excel
Mar 31, 2016 Mar 31, 2015 Mar 31, 2014 Mar 31, 2013 Mar 31, 2012 Mar 31, 2011
No. shares of common stock outstanding1 225,020,523 231,553,531 230,576,753 226,611,092 235,397,188 252,120,037
Selected Financial Data (US$)
Net income attributable to McKesson Corporation (in millions) 2,258 1,476 1,263 1,338 1,403 1,202
Earnings per share (EPS)2 10.03 6.37 5.48 5.90 5.96 4.77
Share price1, 3 172.70 229.55 178.20 108.63 90.17 82.84
Valuation Ratio
P/E ratio4 17.21 36.01 32.53 18.40 15.13 17.38
Benchmarks
P/E Ratio, Competitors5
Abbott Laboratories
Cigna Group
CVS Health Corp.
Elevance Health Inc.
Humana Inc.
Intuitive Surgical Inc.
Medtronic PLC
UnitedHealth Group Inc.

Based on: 10-K (reporting date: 2016-03-31), 10-K (reporting date: 2015-03-31), 10-K (reporting date: 2014-03-31), 10-K (reporting date: 2013-03-31), 10-K (reporting date: 2012-03-31), 10-K (reporting date: 2011-03-31).

1 Data adjusted for splits and stock dividends.

2 2016 Calculation
EPS = Net income attributable to McKesson Corporation ÷ No. shares of common stock outstanding
= 2,258,000,000 ÷ 225,020,523 = 10.03

3 Closing price as at the filing date of McKesson Corp. Annual Report.

4 2016 Calculation
P/E ratio = Share price ÷ EPS
= 172.70 ÷ 10.03 = 17.21

5 Click competitor name to see calculations.

Valuation ratio Description The company
P/E ratio The P/E ratio tells analyst how much an investor in common stock pays per dollar of current earnings. McKesson Corp. P/E ratio increased from 2014 to 2015 but then decreased significantly from 2015 to 2016.

Price to Operating Profit (P/OP)

McKesson Corp., historical P/OP calculation, comparison to benchmarks

Microsoft Excel
Mar 31, 2016 Mar 31, 2015 Mar 31, 2014 Mar 31, 2013 Mar 31, 2012 Mar 31, 2011
No. shares of common stock outstanding1 225,020,523 231,553,531 230,576,753 226,611,092 235,397,188 252,120,037
Selected Financial Data (US$)
Operating income (in millions) 3,545 2,968 2,367 2,315 2,149 1,821
Operating profit per share2 15.75 12.82 10.27 10.22 9.13 7.22
Share price1, 3 172.70 229.55 178.20 108.63 90.17 82.84
Valuation Ratio
P/OP ratio4 10.96 17.91 17.36 10.63 9.88 11.47
Benchmarks
P/OP Ratio, Competitors5
Abbott Laboratories
Cigna Group
CVS Health Corp.
Elevance Health Inc.
Humana Inc.
Intuitive Surgical Inc.
Medtronic PLC
UnitedHealth Group Inc.

Based on: 10-K (reporting date: 2016-03-31), 10-K (reporting date: 2015-03-31), 10-K (reporting date: 2014-03-31), 10-K (reporting date: 2013-03-31), 10-K (reporting date: 2012-03-31), 10-K (reporting date: 2011-03-31).

1 Data adjusted for splits and stock dividends.

2 2016 Calculation
Operating profit per share = Operating income ÷ No. shares of common stock outstanding
= 3,545,000,000 ÷ 225,020,523 = 15.75

3 Closing price as at the filing date of McKesson Corp. Annual Report.

4 2016 Calculation
P/OP ratio = Share price ÷ Operating profit per share
= 172.70 ÷ 15.75 = 10.96

5 Click competitor name to see calculations.

Valuation ratio Description The company
P/OP ratio Because P/E ratio is calculated using net income, the ratio can be sensitive to nonrecurring earnings and capital structure, analysts may use price to operating profit. McKesson Corp. P/OP ratio increased from 2014 to 2015 but then decreased significantly from 2015 to 2016.

Price to Sales (P/S)

McKesson Corp., historical P/S calculation, comparison to benchmarks

Microsoft Excel
Mar 31, 2016 Mar 31, 2015 Mar 31, 2014 Mar 31, 2013 Mar 31, 2012 Mar 31, 2011
No. shares of common stock outstanding1 225,020,523 231,553,531 230,576,753 226,611,092 235,397,188 252,120,037
Selected Financial Data (US$)
Revenues (in millions) 190,884 179,045 137,609 122,455 122,734 112,084
Sales per share2 848.30 773.23 596.80 540.38 521.39 444.57
Share price1, 3 172.70 229.55 178.20 108.63 90.17 82.84
Valuation Ratio
P/S ratio4 0.20 0.30 0.30 0.20 0.17 0.19
Benchmarks
P/S Ratio, Competitors5
Abbott Laboratories
Cigna Group
CVS Health Corp.
Elevance Health Inc.
Humana Inc.
Intuitive Surgical Inc.
Medtronic PLC
UnitedHealth Group Inc.

Based on: 10-K (reporting date: 2016-03-31), 10-K (reporting date: 2015-03-31), 10-K (reporting date: 2014-03-31), 10-K (reporting date: 2013-03-31), 10-K (reporting date: 2012-03-31), 10-K (reporting date: 2011-03-31).

1 Data adjusted for splits and stock dividends.

2 2016 Calculation
Sales per share = Revenues ÷ No. shares of common stock outstanding
= 190,884,000,000 ÷ 225,020,523 = 848.30

3 Closing price as at the filing date of McKesson Corp. Annual Report.

4 2016 Calculation
P/S ratio = Share price ÷ Sales per share
= 172.70 ÷ 848.30 = 0.20

5 Click competitor name to see calculations.

Valuation ratio Description The company
P/S ratio An rationale for the P/S ratio is that sales, as the top line in an income statement, are generally less subject to distortion or manipulation than other fundamentals such as EPS or book value. Sales are also more stable than earnings and never negative. McKesson Corp. P/S ratio decreased from 2014 to 2015 and from 2015 to 2016.

Price to Book Value (P/BV)

McKesson Corp., historical P/BV calculation, comparison to benchmarks

Microsoft Excel
Mar 31, 2016 Mar 31, 2015 Mar 31, 2014 Mar 31, 2013 Mar 31, 2012 Mar 31, 2011
No. shares of common stock outstanding1 225,020,523 231,553,531 230,576,753 226,611,092 235,397,188 252,120,037
Selected Financial Data (US$)
Total McKesson Corporation stockholders’ equity (in millions) 8,924 8,001 8,522 7,070 6,831 7,220
Book value per share (BVPS)2 39.66 34.55 36.96 31.20 29.02 28.64
Share price1, 3 172.70 229.55 178.20 108.63 90.17 82.84
Valuation Ratio
P/BV ratio4 4.35 6.64 4.82 3.48 3.11 2.89
Benchmarks
P/BV Ratio, Competitors5
Abbott Laboratories
Cigna Group
CVS Health Corp.
Elevance Health Inc.
Humana Inc.
Intuitive Surgical Inc.
Medtronic PLC
UnitedHealth Group Inc.

Based on: 10-K (reporting date: 2016-03-31), 10-K (reporting date: 2015-03-31), 10-K (reporting date: 2014-03-31), 10-K (reporting date: 2013-03-31), 10-K (reporting date: 2012-03-31), 10-K (reporting date: 2011-03-31).

1 Data adjusted for splits and stock dividends.

2 2016 Calculation
BVPS = Total McKesson Corporation stockholders’ equity ÷ No. shares of common stock outstanding
= 8,924,000,000 ÷ 225,020,523 = 39.66

3 Closing price as at the filing date of McKesson Corp. Annual Report.

4 2016 Calculation
P/BV ratio = Share price ÷ BVPS
= 172.70 ÷ 39.66 = 4.35

5 Click competitor name to see calculations.

Valuation ratio Description The company
P/BV ratio The P/BV ratio is interpreted as an indicator of market judgment about the relationship between a company required rate of return and its actual rate of return. McKesson Corp. P/BV ratio increased from 2014 to 2015 but then decreased significantly from 2015 to 2016.