McKesson (MCK) Q3 earnings report preview: what to look for

What happened

McKesson, a healthcare distributor and services company, will report quarterly earnings on Wednesday after the market closes. Last quarter it reported $105.4 billion in revenue, up 7.7% from a year earlier, and beat analyst revenue and earnings-per-share estimates.

Confirmed

Global impact / market context

Investors expect McKesson's revenue to grow 6.7% this quarter, slower than the 10.1% growth of a year earlier. Because the company has missed Wall Street revenue estimates several times in two years, a miss could push some holders to sell, while a beat could support the share price.

Analyst inference

Among peers in healthcare providers and services, Elevance Health posted flat revenue that beat estimates by 3.1%, and BrightSpring Health Services grew revenue 26.4%, beating by 8.9%. These results offer a comparison for how demand across the sector is holding up before McKesson reports.

Analyst inference

What to watch

1. Watch whether reported revenue reaches the expected 6.7% year-on-year growth, which means the percentage change from the same quarter a year earlier, since McKesson has missed revenue estimates multiple times in two years. Confirmed
2. Watch whether analysts keep their estimates unchanged over the next 30 days, since they have reconfirmed them recently, a sign they expect the business to stay on its current path. Proposed
3. Watch the revenue and earnings comparisons from Elevance and BrightSpring to judge whether healthcare demand stayed strong, which could hint at McKesson's own results before it reports. Analyst inference

Evidence

• stockstory.org