Investment Thesis
McKessohn demonstrates strong revenue growth of 16.2% YoY and maintains solid operational cash flow generation of $2.7B, indicating a fundamentally sound business. However, the company's negative stockholders' equity, razor-thin profitability margins (1.0% net margin), and concerning liquidity position (0.88x current ratio) raise significant financial stability concerns that warrant a cautious stance.
MCK Strengths
- Strong revenue growth of 16.2% YoY ($307.1B) demonstrates market expansion and demand
- Solid operating cash flow generation ($2.7B) with positive free cash flow ($2.4B) shows cash conversion capability
- High interest coverage ratio of 18.5x indicates strong debt servicing ability despite leverage
MCK Risks
- Negative stockholders' equity of -$1.3B signals balance sheet deterioration and equity erosion
- Extremely low profitability margins (3.4% gross, 1.3% operating, 1.0% net) indicate thin operating leverage in capital-intensive wholesale distribution
- Weak liquidity position with current ratio of 0.88x and quick ratio of 0.48x raises concerns about short-term obligations coverage
- Declining net income (-5.3% YoY) despite rising revenue suggests margin compression and operational headwinds
Key Metrics to Watch
- Stockholders' equity trend and capital structure restoration plans
- Net margin trend and ability to sustain profitability amid revenue growth
- Current and quick ratios to monitor working capital adequacy and liquidity improvement
MCK Financial Metrics
MCK Profitability Ratios
MCK Balance Sheet & Liquidity
MCK 5-Year Financial Trend
5-Year Trend Summary: MCKESSON CORP's revenue has grown significantly by 51% over the 5-year period, indicating strong business expansion. The most recent EPS of $25.03 reflects profitable operations.
MCK Growth Metrics (YoY)
MCK Quarterly Performance
| Quarter | Revenue | Net Income | EPS |
|---|---|---|---|
| Q3 2026 | $95.3B | $879.0M | $6.95 |
| Q2 2026 | $93.7B | $241.0M | $1.87 |
| Q1 2026 | $79.3B | $784.0M | $6.25 |
| Q3 2025 | $80.9B | $589.0M | $4.42 |
| Q2 2025 | $77.2B | $241.0M | $1.87 |
| Q1 2025 | $74.5B | $915.0M | $7.00 |
| Q3 2024 | $70.5B | $589.0M | $4.42 |
| Q2 2024 | $70.2B | $664.0M | $4.92 |
Data sourced from SEC EDGAR 10-Q quarterly filings. Figures may represent quarterly or cumulative values.
MCK Capital Allocation
MCK SEC Filings
Access official SEC EDGAR filings for MCKESSON CORP (CIK: 0000927653)