CAH guidance and follow up actions

By | April 18, 2017

CAH announced a purchase from Medtronic and some guidance this morning. https://seekingalpha.com/symbol/CAH

At first read, i thought that this would be a ‘buy the dip’ scenario and i would add to my very small current position.  Then i dug a bit deeper into the report.  Their earnings forecast just doomed the stock for the near term.  If i piece it together using basic rounding … 2017 = $5.35, 2018 = $5.00-5.25, and 2019 = $5.40-5.60 … analysts have not jumped in yet … but this changes my fondness for the dip … my relative risk algorithm tipped to the negative through same time period.  My earlier plan is reversed … i now need to sit and wait if i want more CAH … interesting level is in the $65-68 space given both its earnings growth view and dividend though i give the company credit for increasing its product portfolio.

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