Cencora Targets 8%-10% Fiscal 2027 EPS Growth After Strong Q4

Cencora Inc. (NYSE: COR) forecast adjusted diluted earnings per share of $19.40 to $19.75 for fiscal 2027, representing growth of 8% to 10%, after stronger pharmaceutical sales and the OneOncology acquisition helped lift fourth-quarter profit.

The pharmaceutical distributor expects fiscal 2027 revenue to grow 3% to 5% from fiscal 2026 revenue of $337.4 billion. Adjusted operating income is projected to increase 4% to 6% from $4.8 billion. The company does not provide corresponding GAAP forecasts because certain adjustments cannot be reasonably estimated.

For the fourth quarter ended Sept. 30, 2026, revenue rose 5.5% to $88.4 billion. Adjusted operating income increased 22.1% to $1.25 billion, while adjusted net income attributable to Cencora gained 19% to $893 million. Adjusted diluted EPS climbed 21.4% to $4.66, also benefiting from a lower diluted share count.

On a GAAP basis, Cencora recorded quarterly operating income of $907 million, net income attributable to the company of $519 million and diluted EPS of $2.71. That compared with a GAAP net loss of $340 million and a loss of $1.75 per diluted share a year earlier, when results included a substantial asset impairment. Fourth-quarter 2026 adjustments included acquisition and divestiture costs, intangible-asset amortization, restructuring expenses and discrete tax items.

U.S. pharmaceutical sales drive quarterly growth

Revenue in U.S. Healthcare Solutions increased 5.4% to $78.3 billion, reflecting overall market growth led by unit volumes. Cencora cited higher specialty-product sales to health systems and physician practices, along with increased sales of GLP-1 products labeled for diabetes and weight loss.

Those gains were partly offset by manufacturer price declines for certain branded pharmaceuticals and lower sales to a large mail-order customer. Segment operating income advanced 22% to $998 million as higher pharmaceutical sales and the February 2026 acquisition of OneOncology lifted gross profit, partly offset by increased operating expenses. Operating margin rose to 1.27% from 1.10%.

International Healthcare Solutions revenue grew 5.1% to $7.8 billion, or 7.8% on a constant-currency basis, with growth across all businesses in the segment. Operating income increased 16.4% to $152 million and rose 18.9% in constant currency, primarily because of higher earnings from the Canadian and global specialty-logistics operations.

The company’s Other category generated revenue of $2.3 billion, up 10.1%, mainly on growth at Profarma and MWI Animal Health. The increase was partly offset by lower consulting-services sales following the April 2026 divestiture of U.S. Consulting Services. Operating income in the category rose 35.8% to $101 million, supported by growth at MWI Animal Health and lower depreciation after that business was classified as held for sale.

Full-year adjusted EPS rises 12.3%

For fiscal 2026, Cencora’s revenue increased 5% to $337.4 billion. Adjusted operating income rose 14% to $4.81 billion, while adjusted diluted EPS advanced 12.3% to $17.97. Adjusted free cash flow totaled $3.81 billion, based on operating cash flow of $4.79 billion, capital expenditures of $910 million and an adjustment for antitrust litigation settlement proceeds.

GAAP operating income rose 49.5% to $3.93 billion, and GAAP diluted EPS increased to $17.95 from $7.96. The fiscal 2026 GAAP results included a gain related to the remeasurement of Cencora’s previously held investment in OneOncology, while fiscal 2025 included a larger asset impairment.

Cencora raised its quarterly cash dividend by 10% to $0.66 per common share.

New reporting structure emphasizes specialty services

Cencora reorganized its operating model in the first quarter of fiscal 2027, replacing its previous reportable-segment structure to provide greater execution focus and visibility.

Under the recast structure, the company expects Pharmaceutical Distribution and Services revenue to grow 4% to 6% in fiscal 2027 from a recast fiscal 2026 base of $284.5 billion. Operating income for the segment is expected to rise 2% to 4% from $2.7 billion.

Specialty Pharmaceutical and Provider Services revenue is projected to grow 9% to 14% from $45.4 billion, with operating income expected to increase 18% to 21% from $1.7 billion. The outlook aligns with Cencora’s focus on specialty pharmaceuticals, community-based specialty care and integrated support across the therapy lifecycle.

The company also signed a definitive agreement to acquire American Oncology Network, a physician-led organization with more than 350 oncology providers across 21 states. No financial terms or expected closing date were provided in the presentation.

Fiscal 2027 expectations assume Cencora’s sale of its Profarma stake will close in the first quarter and that the MWI Animal Health merger with Covetrus will close on March 31, 2027. The Other category is expected to generate about $3.5 billion of revenue and $200 million of operating income, compared with recast fiscal 2026 figures of $8.7 billion and $393 million, respectively.

Cencora also projects approximately $3.5 billion of adjusted free cash flow and about $1 billion of capital expenditures for fiscal 2027. Net interest expense is expected to be between $490 million and $510 million, while the adjusted effective tax rate is forecast at about 20%.

The outlook remains subject to management’s assumptions, including the timing of pending transactions, pharmaceutical pricing and other factors that could cause actual results to differ materially. The company also noted that variables including LIFO effects, acquisition-related amortization and legal settlements cannot be reasonably estimated for purposes of providing GAAP guidance.