McKesson sharpens its focus

Article Excerpt

MCKESSON CORP. $247 is a buy for aggressive investors. The company (New York symbol MCK; Aggressive Growth Portfolio, Consumer sector; Shares outstanding: 152.7 million; Market cap: $37.7 billion; Price-to-sales ratio: 0.2; Dividend yield 0.8%; TSINetwork Rating: Above Average; www.mckesson.com) is now selling its European operations (in stages) so it can focus on its more-profitable North American drug distribution and drugstore businesses. In all, it expects to receive roughly $1.83 billion when it completes these transactions in early 2022. McKesson will probably use some of that cash for share buybacks—it has $1.5 billion remaining under its current repurchase authorization. The stock has jumped 38% in the past year, partly due to its role in distributing COVID-19 vaccines in the U.S. Even so, it still trades at just 11.1 times the $22.73 a share that McKesson will probably earn in the fiscal year ending March 31, 2022. The $1.88 dividend yields 0.8%. McKesson is a buy. buy…