During the second quarter, guru Arnold Van Den Berg (Trades, Portfolio) purchased a 77,330 stake in Cardinal Health (CAH, Financial) at an average price of $79.76 per share. Cardinal Health is one of the largest health care supply chains in North America. The purchase had a 1.01% impact on Van Den Berg’s portfolio.
Cardinal Health originally began its operations in Ohio in 1979. The company’s primary goals are to help pharmacies, hospitals, and other healthcare providers focus on patient care while reducing costs, enhance efficiency and improve overall quality of service. Cardinal Health serves more than 1.8 million patients with 40,000 products. The company works with more than 5,000 pharmaceutical and medical-surgical suppliers, while it serves more than 20,000 U.S. pharmacies nationwide. Cardinal Health also employs nearly 35,000 employees worldwide.
Cardinal Health has a market cap of $26.83 billion, a P/E ratio of 19.61, an enterprise value of $29.8 billion and a P/B ratio of 4.
According to GuruFocus, Cardinal Health has five good signs, which may have influenced Van Den Berg’s decision to purchase a stake during the second quarter.
- The company’s operating margin is in expansion with a 6/10 profitability and growth rating from GuruFocus. Margin expansion is usually a good sign.
- The company's dividend yield is close to its two-year high.
- Cardinal Health's P/E ratio of 19.64 is close to the three-year low of 17.91.
- The P/B ratio is close to a two-year low.
- P/S ratio is close to the two-year low.
Below is a Peter Lynch Chart for Cardinal Health, showing that it is currently trading above its intrinsic value.
In conclusion
Cardinal Health has 37 years of experience in its industry. The company’s primary goals are to help pharmacies, hospitals, and other health care providers focus on patient care while reducing costs. The company is one of the largest health care supply chains in North America, and it has multiple good signs according to GuruFocus.
Cheers to your investment success.
Disclosure: Author does not currently own any shares of this company.
