Here's Why You Should Add Cencora Stock to Your Portfolio Now

Cencora, Inc. COR is well-poised for growth on the back of robust U.S. Healthcare Solutions business and product launches. However, intense competition is a concern.Shares of this Zacks Rank #2 (Buy) company have risen 16.5% so far this year compared with the industry’s 4.7% growth. The S&P 500 Index has decreased 2.1% in the same time frame.Cencora is one of the world’s largest pharmaceutical service companies. It is focused on providing drug distribution and related services to reduce healthcare costs and improve patient outcomes. The company has a market capitalization of $49.37 billion.COR’s bottom line is anticipated to improve 12.1% over the next five years. Its earnings beat estimates in each of the trailing four quarters, delivering an average surprise of 4.94%.Image Source: Zacks Investment ResearchWhat’s Driving COR’s Growth?The company reported robust first-quarter fiscal 2025 results, with earnings per share (EPS) of $3.73 (up 13.7% year over year) and revenues of $81.49 billion (up 12.8%). Strong performance in its U.S. Healthcare Solutions segment, particularly in specialty products and GLP-1 medications, drove the growth.Internationally, revenues rose 5.5% despite currency challenges, supported by the European and Canadian markets. However, the International segment’s operating income declined due to lower operating income at COR’s global specialty logistics business, partially offset by an increase in its European distribution business.For fiscal 2025, adjusted EPS is estimated to be in the range of $15.15-$15.45 (up from the previous projection of 14.80-$15.10), indicating growth of 8-10% from the prior-year level. The top line is projected to rise 8-10% (previously 7-9%). Revenues from the U.S. Healthcare Solutions segment and the International Healthcare solutions business are estimated to increase 9-11% and 4-5%, respectively. Adjusted operating income is anticipated to improve 11.5-13.5%from the earlier guidance of 5-6.5%.Cencora also acquired Retina Consultants of America earlier this year, expanding its specialty capabilities beyond oncology. This acquisition complements COR’s pharmaceutical-centric strategy, strengthens its Management Services Organization portfolio and positions it well in the growing retina and ophthalmology market.Meanwhile, Cencora’s focus on specialty pharmaceuticals remains a significant growth driver. Increasing demand for GLP-1 products and specialty distribution to physicians and health systems support strong revenue momentum. Investments in distribution infrastructure and technology improve logistics support and temperature-sensitive product handling and enhance compliance with regulatory standards.Investments in automation and continuity within COR’s European and Canadian businesses ensure resilience and scalability in international markets. Renewed collaborations with Express Scripts and Walgreens strengthen core distribution capabilities and align resources to effectively meet customer needs.What’s Hurting COR Stock?Cencora operates in a highly competitive pharmaceutical distribution and related healthcare services market. The generic industry is facing consolidation of customers and manufacturers, global competitors and regulatory challenges.Higher sales of low-margin GLP-1 products and declining COVID-related revenues compress profit margins. Changes in U.S. healthcare policy, particularly Medicare Part B and D reimbursement reforms, could adversely impact profitability. A goodwill impairment on PharmaLex reflects underperformance in outsourced pharma services due to market pressures.Increasing competition in specialty and biosimilar markets may challenge market share and pricing strategies.Cencora, Inc. Price Cencora, Inc. price | Cencora, Inc. QuoteEstimate TrendCOR has been witnessing a positive estimate revision trend for fiscal 2025. In the past 30 days, the Zacks Consensus Estimate for earnings has increased from $15.22 to $15.36 per share.The consensus mark for second-quarter fiscal 2025 revenues is $74.58 billion, indicating a 9% improvement from the year-ago reported actuals. The bottom-line estimate is $4.07, implying year-over-year growth of 7.1%.Other Stocks to ConsiderSome other top-ranked stocks in the broader medical space are Cardinal Health, Inc. CAH, ResMed Inc. RMD and Aveanna Healthcare AVAH.Cardinal Health, carrying a Zacks Rank #2 at present, has an estimated long-term growth rate of 9.5%. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.CAH’s earnings surpassed estimates in each of the trailing four quarters, the average surprise being 9.64%. Its shares have risen 4.8% compared with the industry’s 1.2% growth so far this year.ResMed, carrying a Zacks Rank of 2 at present, has an estimated long-term growth rate of 16%. RMD’s earnings surpassed estimates in each of the trailing four quarters, the average surprise being 6.86%.ResMed’s shares have gained 3.5% compared with the industry’s 10.5% growth so far this year.Aveanna Healthcare, carrying a Zacks Rank of 2 at present, has an estimated growth rate of 666.7% for 2025. AVAH’s earnings surpassed estimates in each of the trailing four quarters, the average surprise being 135.00%.Aveanna Healthcare’s shares have declined 19.5% against the industry’s 3.5% growth so far this year.Zacks' Research Chief Names "Stock Most Likely to Double"Our team of experts has just released the 5 stocks with the greatest probability of gaining +100% or more in the coming months. Of those 5, Director of Research Sheraz Mian highlights the one stock set to climb highest.This top pick is among the most innovative financial firms. With a fast-growing customer base (already 50+ million) and a diverse set of cutting edge solutions, this stock is poised for big gains. Of course, all our elite picks aren’t winners but this one could far surpass earlier Zacks’ Stocks Set to Double like Nano-X Imaging which shot up +129.6% in little more than 9 months.Free: See Our Top Stock And 4 Runners UpWant 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 ResMed Inc. (RMD): Free Stock Analysis Report Cencora, Inc. (COR): Free Stock Analysis Report Aveanna Healthcare Holdings Inc. (AVAH): 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