Cardinal Health (CAH) Soars 4.91% on Strong Guidance

Cardinal Health (CAH) surged to a record high today, with an intraday gain of 4.91%.

The strategy of buying CAH shares after they reach a recent high and holding for 1 week yielded strong results over the past five years. The strategy achieved an overall return of 86.83%, significantly outperforming the benchmark return of 56.28%. The excess return generated by the strategy was 30.55%, indicating that it delivered substantial gains relative to the benchmark. Moreover, the strategy's CAGR was 29.46%, which is a robust indicator of its compounding effectiveness. While the strategy had a maximum drawdown of -19.38%, it maintained a relatively high Sharpe ratio of 1.44, suggesting that the risk-adjusted returns were impressive. The volatility of the strategy was 20.43%, which implies that the strategy's returns were not overly reliant on any single factor and had a broad base of contributors.

Cardinal Health's recent stock price surge can be attributed to several strategic initiatives and positive financial updates. The company has raised its FY25 non-GAAP diluted EPS guidance to $8.15 to $8.20, exceeding previous expectations. This revised guidance, along with the establishment of preliminary FY26 guidance with a 13% growth at the mid-point, has bolstered investor confidence. The company's efforts to enhance its Pharmaceutical and Specialty Solutions segment and expand its Specialty Alliance MSO platform have also contributed to the positive market sentiment. Additionally, investments in Biopharma Solutions and improvements in pharmaceutical distribution capabilities are driving further optimism among investors. The Board of Directors' approval of an increase in the quarterly dividend has provided additional support for the stock's upward trajectory.