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McKesson Corporation

MCK
55
Medical - Distribution · Healthcare
Price
$841.39
+0.08 (+0.01%)
Market Cap
$98.51B
Winston Score
55
Winston is curious
A decent business — some strong pillars, some weaker.

Share count falling — buybacks

19.5% over 4y

The company has reduced its share count over this period, returning value to shareholders through buybacks.

Diluted shares outstanding: 154.1M (2022) → 124.1M (2026)

McKesson Corporation is one of the largest healthcare distribution companies in the United States. It moves medicines, medical supplies, and healthcare products from manufacturers to hospitals, pharmacies, and doctors' offices. Think of McKesson as a giant middleman that makes sure the right drugs and supplies get to the right places across the country.

McKesson makes money by buying products in bulk from drug makers and selling them to healthcare providers, earning a small margin on each transaction — which explains the very thin gross margins. It operates primarily in the United States, with some international presence, and generates over $300 billion in annual revenue, making it one of the largest companies in America by sales. Its size and deep relationships with suppliers and customers create a strong competitive position that is hard for smaller rivals to match. The main risk is that pricing pressure from large pharmacy chains and potential changes to drug distribution regulations could squeeze its already narrow margins further.

Winston Score History

Politician Trades

24 trades / 12mo

13 Congressional buys and 11 sells on MCK in the last 12 months.

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Growth Profile

When traditional metrics don't capture the full picture, these are the signals growth stock investors use instead.

Revenue Growth

+6.0% YoY

YoY Growth Rate

Slow revenue growth

EPS Growth

+37.0% YoY

YoY Growth Rate

Strong earnings growth

R&D Spend

$103M/ year

Rising (+13% vs prior year)

0.0% of revenue

Below sector average (18%)

R&D investment increasing — building for the future

Insider Activity

0.0%ownership

Flat

Insiders holding steady — not selling despite ability to

Cash Position

Cash flow positive

$4.0B cash & investments

Quarterly Free Cash Flow

↑ Burn rate improving

Company generates more cash than it spends — no dilution risk from fundraising

Growth context

McKesson Corporation is growing revenue at 6% year-over-year. The Winston Score measures business quality today — these growth metrics show what could matter tomorrow.

The Winston Score above measures business quality today. Growth stocks often score lower because they invest in the future rather than maximising current profits. These metrics show what matters most for evaluating that future.

Score breakdown

Every number that matters to educated investors.

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Quality

Gross Margin
4.2%
Thin — 4.2% gross margin
Operating Margin
2.3%
Thin — 2.3% operating margin
ROCE
50.1%
Exceptional — 50.1% return on capital

ROIC above 25%. Every dollar invested in the business earns more than 25 cents back per year.

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Growth

Sales YoY
+9.2%
Steady sales growth (9.2% YoY)
EPS YoY
+100.3%
Earnings growing fast (100.3% YoY)

Earnings growing 25%+ a year. The compounder zone.

EPS Consistency
8/8 quarters
Every recent quarter grew earnings vs last year

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Cash Flow

Cash Conversion
283%
Turns 283% of profit into real cash
FCF Margin
3.6%
Thin free cash flow (3.6%)

FCF margin between 0% and 10%. Some cash from sales, but not a lot.

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Stability

Debt / Equity
N/A
Data not available
Interest Cover
52.65x
Comfortably covers interest (52.7x)

Interest coverage above 8. Profits cover interest many times over.

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Valuation

P/E Ratio (TTM)
19.8x
Fair value — P/E 19.8

P/E in the normal range. Price is roughly $15 for every $1 of yearly profit.

P/E vs Forward
+6.5
GROWING
Earnings expected to grow meaningfully — cheaper on forward P/E (19.8 → 13.3)

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Dividends

Dividend Yield
0.43%
Small dividend — 0.43% yield

Modest yield. The bulk of any return needs to come from price appreciation.

Dividend Growth
+15.5%
Dividend growing fast (15.5% YoY)

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