MCK Stock Gains More Than 4% Following Strong Q4: Should You Buy Now?

McKesson’s MCK shares have gained 4.4% following its fourth-quarter fiscal 2025 earnings release on May 9. The post-earnings upside reflects growing investor confidence in McKesson’s strategic execution and long-term positioning, underpinned by record full-year revenues of $359 billion and a 20% year-over-year increase in adjusted earnings per share (to $33.05). The market’s positive response highlights the strength of McKesson’s transformation into a more diversified healthcare service provider with a sharp focus on high-growth, high-margin segments. MCK’s shares have outperformed the industry and the broader Medical sector’s growth of 3.8% and 1%, respectively, since the earnings release.As the company advances through the remainder of 2025, multiple catalysts may continue to fuel its performance and potentially drive shares higher. These catalysts include the rapid expansion of its oncology and biopharma services platforms, operational efficiencies driven by technology and automation. Together, these initiatives position McKesson for continued earnings growth, stronger cash flow and greater strategic focus on a dynamic healthcare landscape.Price Performance Since May 9Image Source: Zacks Investment ResearchMcKesson enters fiscal 2026 with a clear playbook for growth, anchored by four strategic pillars — Oncology, Biopharma services, Specialty distribution and AI-enabled solutions. Each lever not only complements the others but also positions McKesson to capture outsized market opportunities and drive shareholder value.Oncology Platform ExpansionMcKesson’s U.S. Oncology Network now spans over 2,700 providers at 645 sites across 31 states. The recent close of the Core Ventures acquisition will add 530 Florida-based practitioners, deepening penetration in the nation’s third-largest oncology market. McKesson is also focusing on value-based care, including support for 70% of network physicians in the CMS Enhancing Oncology Model. This demonstrates its commitment to lowering the total cost of care while improving outcomes. Continued organic growth and onboarding of practices through year-end should lift both revenues and referral volumes for its clinical trial and practice management services.Biopharma Services as a High-Margin EngineMcKesson’s Prescription Technology Solutions segment has become the backbone of its patient-centric offerings. By automating prior authorizations, delivering copay assistance and integrating hub services, McKesson prevented 12 million prescription abandonments and enabled over 100 million medication accesses in fiscal 2025. As new specialty and rare-disease therapies emerge, the demand for turnkey access and affordability programs will only intensify. McKesson’s growing biopharma connectivity — spanning manufacturers, payers, providers and pharmacies — should continue to deliver double-digit operating profit growth without the capital intensity of distribution.Specialty Distribution ResilienceWhile broad pharmaceutical volumes can fluctuate with macroeconomic trends, McKesson’s specialty distribution expertise provides both stickiness and margin improvement. Its plasma and biologics franchise, coupled with the onboarding of a major national account partner, gives McKesson a durable competitive advantage. Looking forward, the launch of new therapies in oncology, immunology, and gene therapy will be distributed through McKesson’s network, driving higher per-script margins and more predictable revenue streams.AI and Automation Driving EfficiencyTechnology isn’t just a back-office play — McKesson is weaving AI into every customer touchpoint. During the latest annual verification season, its CoverMyMeds virtual assistant automated over 20% of patient-support chats, maintaining parity in satisfaction with human agents. In the supply chain, early AI pilots promise to optimize inventory turns and reduce fulfillment costs. As these initiatives scale, McKesson can leverage higher operatinal efficiency, offsetting wage inflation and supply-chain complexity.Building on its strong segmental performance, McKesson is well-positioned to extend its recent share-price gains and deliver compelling returns through the remainder of 2025. This momentum is further reinforced by its technical strength, with the stock trading above key support levels at both the 50-day and 200-day moving averages — an indication of sustained investor confidence and bullish market sentiment.MCK Stock Trades Above 50 & 200 DMAImage Source: Zacks Investment ResearchCompetitive Challenges and Market HeadwindsDespite its strong positioning, McKesson faces several competitive and market headwinds. Slowing growth in GLP-1 prescriptions and continued softness in primary care volumes could weigh on distribution revenues.McKesson faces strong competition in specialty care from Cencora COR and Cardinal Health CAH, both of which are scaling their specialty operations. Cencora remains the largest specialty distributor in the United States, with robust services in oncology and other therapeutic areas, supported by its ICS and Lash Group units. It continues to invest in data analytics and global logistics to enhance biopharma partnerships. Cardinal Health, through its Specialty Solutions division, offers distribution, GPO and patient hub services across multiple specialties. It is also expanding into home-based care and enhancing its digital capabilities to strengthen provider engagement and specialty pharmacy performance.However, MCK’s share performance has outperformed both its peers since May 9 with CAH and COR gaining 4.1% and 2.6%, respectively.MCK’s P/E F12M Higher Than IndustryImage Source: Zacks Investment ResearchWrapping UpThe share price of MCK tested the 50-DMA on May 12 and seems to continue its upward journey as it trades 0.6% below its all-time high of $728.32 made on April 4. The fundamental as well as technical strength is likely to drive shares of the company to a new all-time high in the upcoming period.MCK currently carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.Although the stock’s valuation is above its industry, the Zacks Value score of ‘A’ suggests an attractive entry point for investors. Moreover, the company also possesses a Zacks Growth score of ‘A’, implying continuation of the uptrend. However, the stock’s upside move is likely to slow until it breaks past the all-time high, also reflected in its Zacks Momentum score of ‘F’.As such, we believe that investors may hold the stock for now. Nevertheless, we caution against taking a new position. Strong fundamentals suggest an upside to the share price, but investors should wait for an attractive entry point.7 Best Stocks for the Next 30 DaysJust released: Experts distill 7 elite stocks from the current list of 220 Zacks Rank #1 Strong Buys. They deem these tickers "Most Likely for Early Price Pops."Since 1988, the full list has beaten the market more than 2X over with an average gain of +23.0% per year. So be sure to give these hand picked 7 your immediate attention. See them now >>Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Cardinal Health, Inc. (CAH): Free Stock Analysis Report McKesson Corporation (MCK): Free Stock Analysis Report Cencora, Inc. (COR): Free Stock Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).Zacks Investment ResearchWeiter zum vollständigen Artikel bei Zacks Weiter zum vollständigen Artikel bei Zacks