I added more shares to my portfolio with the purchase of Cardinal Health Inc. (CAH)
28 shares @ $50.99 on 7/16/2018.
This increases my forward 12-month dividend income by $53.48 to a total of $5,933.94
I also updated my portfolio page to reflect the change.
It has been almost eight months since my last buy of Cardinal Health. Currently, in my portfolio, this company holds first place for the most money I have invested in a single company. The bad news is that I am in the red right now. I am under -20.80%. That’s ok. I am holding Cardinal Health for the long term. You will see why soon.
CAH has a dividend growth rate of 23 years. They have a 5-year dividend growth rate of 15% and a current dividend yield of 3.81%. The 5-year dividend yield average is 2.10%. That gives you some perspective on how much the price of the company has dropped.
CFRA is predicting earnings of $4.90 for the fiscal year 2018 and $5.23 for the fiscal year 2019. This is much higher than last year earnings of $4.03. The stock has a forward PE of 9.81. The best part is that the 5-year PE average of the company is 28.01. This tells me that the stock is very much undervalued.
let’s find out how much?
Based on 2018 earnings of $4.90 and a 10 year normal PE of 15.4, The company fair valued is $75.46. This tells us that the stock is 50.80% undervalued.
This is why I think that Cardinal Health is a BUY.
What do you think of the company? Plan on owning it? or why not?
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