Common Stock Valuation Ratios (Price Multiples)
Quarterly Data
Valuation ratios measure the quantity of an asset or flaw (e.g., earnings) associated with ownership of a specified claim (e.g., a share of ownership of the enterprise).
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- Balance Sheet: Assets
- Cash Flow Statement
- Common-Size Balance Sheet: Liabilities and Stockholders’ Equity
- Analysis of Profitability Ratios
- Analysis of Solvency Ratios
- Analysis of Short-term (Operating) Activity Ratios
- Analysis of Reportable Segments
- Operating Profit Margin since 2005
- Total Asset Turnover since 2005
- Price to Book Value (P/BV) since 2005
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Historical Valuation Ratios (Summary)
McKesson Corp., historical price multiples (quarterly data)
Based on: 10-Q (reporting date: 2016-09-30), 10-Q (reporting date: 2016-06-30), 10-K (reporting date: 2016-03-31), 10-Q (reporting date: 2015-12-31), 10-Q (reporting date: 2015-09-30), 10-Q (reporting date: 2015-06-30), 10-K (reporting date: 2015-03-31), 10-Q (reporting date: 2014-12-31), 10-Q (reporting date: 2014-09-30), 10-Q (reporting date: 2014-06-30), 10-K (reporting date: 2014-03-31), 10-Q (reporting date: 2013-12-31), 10-Q (reporting date: 2013-09-30), 10-Q (reporting date: 2013-06-30), 10-K (reporting date: 2013-03-31), 10-Q (reporting date: 2012-12-31), 10-Q (reporting date: 2012-09-30), 10-Q (reporting date: 2012-06-30), 10-K (reporting date: 2012-03-31), 10-Q (reporting date: 2011-12-31), 10-Q (reporting date: 2011-09-30), 10-Q (reporting date: 2011-06-30).
- Price to Earnings (P/E) Ratio
- The P/E ratio exhibited a general upward trend from mid-2011, increasing from 16.48 to a peak of 36.01 in March 2015. Following this peak, the ratio declined steadily to reach 18.96 by late 2016. This pattern suggests an initial growth in investor expectations of future earnings, followed by a phase of correction or moderation in sentiment.
- Price to Operating Profit (P/OP) Ratio
- Between mid-2011 and early 2015, the P/OP ratio increased from 10.78 to a high of 18.59, indicating a rising valuation relative to operating profit. After peaking, the ratio decreased notably, falling to 11.3 by the third quarter of 2016. This decline points toward diminishing market valuation relative to operating performance during that period.
- Price to Sales (P/S) Ratio
- The P/S ratio showed a gradual growth from 0.17 in mid-2011 to approximately 0.31 by late 2013, stabilizing around 0.29-0.3 until early 2015. Subsequently, it declined to about 0.19 by late 2016. This movement indicates increasing valuation related to sales initially, followed by a contraction in market valuation relative to sales in the latter periods.
- Price to Book Value (P/BV) Ratio
- The P/BV ratio rose steadily from 2.83 in mid-2011 to a maximum of 6.64 in early 2015, reflecting growing market confidence in the company's net asset value. Post this apex, the ratio decreased to 3.84 by late 2016, suggesting a reduction in the premium investors were willing to pay over the book value of equity.
- Summary
- Overall, the financial multiples indicate a period of escalating market optimism and valuation growth across earnings, operating profit, sales, and book value metrics until early 2015. After reaching peaks, all ratios consistently declined through 2016, indicative of a cooling in investor expectations or possibly changing operational or market conditions affecting valuation. The trends reflect a cycle of initial expansion in market confidence followed by a phase of recalibration.
Price to Earnings (P/E)
McKesson Corp., historical P/E calculation (quarterly data)
| Sep 30, 2016 | Jun 30, 2016 | Mar 31, 2016 | Dec 31, 2015 | Sep 30, 2015 | Jun 30, 2015 | Mar 31, 2015 | Dec 31, 2014 | Sep 30, 2014 | Jun 30, 2014 | Mar 31, 2014 | Dec 31, 2013 | Sep 30, 2013 | Jun 30, 2013 | Mar 31, 2013 | Dec 31, 2012 | Sep 30, 2012 | Jun 30, 2012 | Mar 31, 2012 | Dec 31, 2011 | Sep 30, 2011 | Jun 30, 2011 | ||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| No. shares of common stock outstanding1 | |||||||||||||||||||||||||||||
| Selected Financial Data (US$) | |||||||||||||||||||||||||||||
| Net income attributable to McKesson Corporation (in millions) | |||||||||||||||||||||||||||||
| Earnings per share (EPS)2 | |||||||||||||||||||||||||||||
| Share price1, 3 | |||||||||||||||||||||||||||||
| Valuation Ratio | |||||||||||||||||||||||||||||
| P/E ratio4 | |||||||||||||||||||||||||||||
| Benchmarks | |||||||||||||||||||||||||||||
| P/E Ratio, Competitors5 | |||||||||||||||||||||||||||||
| Abbott Laboratories | |||||||||||||||||||||||||||||
| Elevance Health Inc. | |||||||||||||||||||||||||||||
| Intuitive Surgical Inc. | |||||||||||||||||||||||||||||
| Medtronic PLC | |||||||||||||||||||||||||||||
| UnitedHealth Group Inc. | |||||||||||||||||||||||||||||
Based on: 10-Q (reporting date: 2016-09-30), 10-Q (reporting date: 2016-06-30), 10-K (reporting date: 2016-03-31), 10-Q (reporting date: 2015-12-31), 10-Q (reporting date: 2015-09-30), 10-Q (reporting date: 2015-06-30), 10-K (reporting date: 2015-03-31), 10-Q (reporting date: 2014-12-31), 10-Q (reporting date: 2014-09-30), 10-Q (reporting date: 2014-06-30), 10-K (reporting date: 2014-03-31), 10-Q (reporting date: 2013-12-31), 10-Q (reporting date: 2013-09-30), 10-Q (reporting date: 2013-06-30), 10-K (reporting date: 2013-03-31), 10-Q (reporting date: 2012-12-31), 10-Q (reporting date: 2012-09-30), 10-Q (reporting date: 2012-06-30), 10-K (reporting date: 2012-03-31), 10-Q (reporting date: 2011-12-31), 10-Q (reporting date: 2011-09-30), 10-Q (reporting date: 2011-06-30).
1 Data adjusted for splits and stock dividends.
2 Q2 2017 Calculation
EPS
= (Net income attributable to McKesson CorporationQ2 2017
+ Net income attributable to McKesson CorporationQ1 2017
+ Net income attributable to McKesson CorporationQ4 2016
+ Net income attributable to McKesson CorporationQ3 2016)
÷ No. shares of common stock outstanding
= ( + + + )
÷ =
3 Closing price as at the filing date of McKesson Corp. Quarterly or Annual Report.
4 Q2 2017 Calculation
P/E ratio = Share price ÷ EPS
= ÷ =
5 Click competitor name to see calculations.
- Share Price Trend
- The share price exhibited a general upward trend from mid-2011 through early 2015, increasing from approximately $79.60 to a peak of around $229.55 in March 2015. This growth period was marked by steady increases with minor fluctuations. However, from mid-2015 onward, the share price showed volatility and a declining pattern, falling from $229.55 to $160.50 by the third quarter of 2016. Overall, the share price almost doubled from 2011 to early 2015 before experiencing a notable decline.
- Earnings Per Share (EPS) Trend
- EPS values generally increased over the period analyzed. Starting at $4.83 in June 2011, EPS gradually rose with some fluctuations reaching a high near $10.03 in March 2016. Despite some variability, particularly in late 2013 and again near the end of the timeline, the overall trend reflects substantial growth in earnings per share, more than doubling over the five-year span.
- Price-to-Earnings (P/E) Ratio Trend
- The P/E ratio showed significant variation across the periods. Initially, it decreased from about 16.48 in mid-2011 to a low near 13.73 by September 2012, indicating that the price growth was somewhat aligned with or outpaced by EPS growth. Subsequently, the ratio increased markedly, peaking around 36.01 in March 2015, which suggests that share prices were relatively high compared to earnings at that point. Post-peak, the P/E ratio declined to around 18.96 by the third quarter of 2016, reflecting the falling share price coupled with sustained EPS growth. The fluctuations in P/E ratio underscore changes in market valuation sentiment over time.
- Overall Insights
- The data reveal a period of strong performance in earnings and share value through early 2015, with the share price and EPS both increasing substantially. After this peak, a divergence arose: while EPS continued to trend upward, share prices decreased, leading to a contraction in the P/E ratio. This pattern may indicate market concerns or external factors affecting investor confidence despite improving company profitability. The varied P/E ratio over the years highlights changing perceptions of value and risk among investors during the timeframe examined.
Price to Operating Profit (P/OP)
McKesson Corp., historical P/OP calculation (quarterly data)
| Sep 30, 2016 | Jun 30, 2016 | Mar 31, 2016 | Dec 31, 2015 | Sep 30, 2015 | Jun 30, 2015 | Mar 31, 2015 | Dec 31, 2014 | Sep 30, 2014 | Jun 30, 2014 | Mar 31, 2014 | Dec 31, 2013 | Sep 30, 2013 | Jun 30, 2013 | Mar 31, 2013 | Dec 31, 2012 | Sep 30, 2012 | Jun 30, 2012 | Mar 31, 2012 | Dec 31, 2011 | Sep 30, 2011 | Jun 30, 2011 | ||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| No. shares of common stock outstanding1 | |||||||||||||||||||||||||||||
| Selected Financial Data (US$) | |||||||||||||||||||||||||||||
| Operating income (in millions) | |||||||||||||||||||||||||||||
| Operating profit per share2 | |||||||||||||||||||||||||||||
| Share price1, 3 | |||||||||||||||||||||||||||||
| Valuation Ratio | |||||||||||||||||||||||||||||
| P/OP ratio4 | |||||||||||||||||||||||||||||
| Benchmarks | |||||||||||||||||||||||||||||
| P/OP Ratio, Competitors5 | |||||||||||||||||||||||||||||
| Abbott Laboratories | |||||||||||||||||||||||||||||
| Elevance Health Inc. | |||||||||||||||||||||||||||||
| Intuitive Surgical Inc. | |||||||||||||||||||||||||||||
| Medtronic PLC | |||||||||||||||||||||||||||||
| UnitedHealth Group Inc. | |||||||||||||||||||||||||||||
Based on: 10-Q (reporting date: 2016-09-30), 10-Q (reporting date: 2016-06-30), 10-K (reporting date: 2016-03-31), 10-Q (reporting date: 2015-12-31), 10-Q (reporting date: 2015-09-30), 10-Q (reporting date: 2015-06-30), 10-K (reporting date: 2015-03-31), 10-Q (reporting date: 2014-12-31), 10-Q (reporting date: 2014-09-30), 10-Q (reporting date: 2014-06-30), 10-K (reporting date: 2014-03-31), 10-Q (reporting date: 2013-12-31), 10-Q (reporting date: 2013-09-30), 10-Q (reporting date: 2013-06-30), 10-K (reporting date: 2013-03-31), 10-Q (reporting date: 2012-12-31), 10-Q (reporting date: 2012-09-30), 10-Q (reporting date: 2012-06-30), 10-K (reporting date: 2012-03-31), 10-Q (reporting date: 2011-12-31), 10-Q (reporting date: 2011-09-30), 10-Q (reporting date: 2011-06-30).
1 Data adjusted for splits and stock dividends.
2 Q2 2017 Calculation
Operating profit per share
= (Operating incomeQ2 2017
+ Operating incomeQ1 2017
+ Operating incomeQ4 2016
+ Operating incomeQ3 2016)
÷ No. shares of common stock outstanding
= ( + + + )
÷ =
3 Closing price as at the filing date of McKesson Corp. Quarterly or Annual Report.
4 Q2 2017 Calculation
P/OP ratio = Share price ÷ Operating profit per share
= ÷ =
5 Click competitor name to see calculations.
The analysis of the financial metrics over the observed quarters reveals several important trends in company performance.
- Share Price
- The share price demonstrates a general upward trend from mid-2011 through early 2015, increasing from approximately $79.60 to a peak near $229.55. This reflects substantial market valuation growth over this period. However, starting from mid-2015, there is a noticeable decline with fluctuations, falling to around $160.50 by late 2016. This downward movement suggests some market correction or external factors impacting investor sentiment during the latter quarters.
- Operating Profit per Share (OPPS)
- Operating profit per share steadily increases throughout the entire period. Beginning at $7.39 in mid-2011, it rises consistently to reach about $15.89 by late 2015. Thereafter, a slight decline to $14.21 is observed by the final recorded quarter in 2016. This indicates overall operational improvement and profitability growth, although the last few quarters exhibit signs of margin pressure or operational challenges.
- Price to Operating Profit Ratio (P/OP)
- The P/OP ratio initially decreases from 10.78 in mid-2011 to 9.20 by late 2012, suggesting that the share price was becoming more aligned or undervalued relative to operating profit growth. Thereafter, the ratio increases sharply to a high of approximately 18.59 around late 2014, indicating that the share price was escalating faster than operating profit during this period. Following this peak, the ratio declines steadily to around 11.30 by late 2016, driven by a combination of declining share price and continued, although slowing, growth in operating profit per share.
In summary, the company experienced strong growth in both share price and operating profit per share over most of the period, with a notable divergence in valuation multiples around 2013 to 2014 whereby the share price outpaced operational earnings growth substantially. Recent quarters show a correction in share price alongside a slight reduction in operating profit per share, leading to a normalization of the price-to-operating profit ratio. These trends suggest that while the company improved operationally, market valuation adjustments have occurred, potentially reflecting changing investor expectations or broader market conditions.
Price to Sales (P/S)
McKesson Corp., historical P/S calculation (quarterly data)
| Sep 30, 2016 | Jun 30, 2016 | Mar 31, 2016 | Dec 31, 2015 | Sep 30, 2015 | Jun 30, 2015 | Mar 31, 2015 | Dec 31, 2014 | Sep 30, 2014 | Jun 30, 2014 | Mar 31, 2014 | Dec 31, 2013 | Sep 30, 2013 | Jun 30, 2013 | Mar 31, 2013 | Dec 31, 2012 | Sep 30, 2012 | Jun 30, 2012 | Mar 31, 2012 | Dec 31, 2011 | Sep 30, 2011 | Jun 30, 2011 | ||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| No. shares of common stock outstanding1 | |||||||||||||||||||||||||||||
| Selected Financial Data (US$) | |||||||||||||||||||||||||||||
| Revenues (in millions) | |||||||||||||||||||||||||||||
| Sales per share2 | |||||||||||||||||||||||||||||
| Share price1, 3 | |||||||||||||||||||||||||||||
| Valuation Ratio | |||||||||||||||||||||||||||||
| P/S ratio4 | |||||||||||||||||||||||||||||
| Benchmarks | |||||||||||||||||||||||||||||
| P/S Ratio, Competitors5 | |||||||||||||||||||||||||||||
| Abbott Laboratories | |||||||||||||||||||||||||||||
| Elevance Health Inc. | |||||||||||||||||||||||||||||
| Intuitive Surgical Inc. | |||||||||||||||||||||||||||||
| Medtronic PLC | |||||||||||||||||||||||||||||
| UnitedHealth Group Inc. | |||||||||||||||||||||||||||||
Based on: 10-Q (reporting date: 2016-09-30), 10-Q (reporting date: 2016-06-30), 10-K (reporting date: 2016-03-31), 10-Q (reporting date: 2015-12-31), 10-Q (reporting date: 2015-09-30), 10-Q (reporting date: 2015-06-30), 10-K (reporting date: 2015-03-31), 10-Q (reporting date: 2014-12-31), 10-Q (reporting date: 2014-09-30), 10-Q (reporting date: 2014-06-30), 10-K (reporting date: 2014-03-31), 10-Q (reporting date: 2013-12-31), 10-Q (reporting date: 2013-09-30), 10-Q (reporting date: 2013-06-30), 10-K (reporting date: 2013-03-31), 10-Q (reporting date: 2012-12-31), 10-Q (reporting date: 2012-09-30), 10-Q (reporting date: 2012-06-30), 10-K (reporting date: 2012-03-31), 10-Q (reporting date: 2011-12-31), 10-Q (reporting date: 2011-09-30), 10-Q (reporting date: 2011-06-30).
1 Data adjusted for splits and stock dividends.
2 Q2 2017 Calculation
Sales per share
= (RevenuesQ2 2017
+ RevenuesQ1 2017
+ RevenuesQ4 2016
+ RevenuesQ3 2016)
÷ No. shares of common stock outstanding
= ( + + + )
÷ =
3 Closing price as at the filing date of McKesson Corp. Quarterly or Annual Report.
4 Q2 2017 Calculation
P/S ratio = Share price ÷ Sales per share
= ÷ =
5 Click competitor name to see calculations.
The analysis reveals several notable trends in the company's financial indicators over the observed periods.
- Share Price (US$)
- The share price demonstrates an overall upward trajectory from June 2011 to March 2015, starting at $79.6 and peaking at $229.55. Following this peak, the price exhibits a declining trend, falling to $160.5 by September 2016. This pattern indicates a period of strong growth in the share price for nearly four years, succeeded by a significant correction or market adjustment in the subsequent periods.
- Sales per Share (US$)
- Sales per share show a consistent increase across all quarters, beginning at $465.33 in June 2011 and rising steadily to $859.26 by September 2016. This uninterrupted growth suggests an ongoing improvement in the company's revenue generation relative to its share count, reflecting operational expansion or enhanced sales efficiency.
- Price-to-Sales (P/S) Ratio
- The P/S ratio initially rises from 0.17 in June 2011 to a high point around 0.31 by December 2013, maintaining a generally elevated level through early 2015. Afterward, a noticeable decline occurs, with the ratio dropping to 0.19 by September 2016. This shift mirrors the share price movement more closely than sales per share, indicating that the market valuation, as represented by the share price, was relatively high compared to sales until early 2015, then adjusted downwards afterward.
In summary, the company experienced a period of robust market valuation growth alongside steadily increasing sales per share for roughly four years. The subsequent downturn in share price and P/S ratio suggests a reassessment of market expectations or external factors impacting stock valuation despite continued growth in sales per share. This divergence between sales growth and market valuation may warrant further investigation into company-specific, sectoral, or macroeconomic influences during the latter periods.
Price to Book Value (P/BV)
McKesson Corp., historical P/BV calculation (quarterly data)
| Sep 30, 2016 | Jun 30, 2016 | Mar 31, 2016 | Dec 31, 2015 | Sep 30, 2015 | Jun 30, 2015 | Mar 31, 2015 | Dec 31, 2014 | Sep 30, 2014 | Jun 30, 2014 | Mar 31, 2014 | Dec 31, 2013 | Sep 30, 2013 | Jun 30, 2013 | Mar 31, 2013 | Dec 31, 2012 | Sep 30, 2012 | Jun 30, 2012 | Mar 31, 2012 | Dec 31, 2011 | Sep 30, 2011 | Jun 30, 2011 | ||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| No. shares of common stock outstanding1 | |||||||||||||||||||||||||||||
| Selected Financial Data (US$) | |||||||||||||||||||||||||||||
| Total McKesson Corporation stockholders’ equity (in millions) | |||||||||||||||||||||||||||||
| Book value per share (BVPS)2 | |||||||||||||||||||||||||||||
| Share price1, 3 | |||||||||||||||||||||||||||||
| Valuation Ratio | |||||||||||||||||||||||||||||
| P/BV ratio4 | |||||||||||||||||||||||||||||
| Benchmarks | |||||||||||||||||||||||||||||
| P/BV Ratio, Competitors5 | |||||||||||||||||||||||||||||
| Abbott Laboratories | |||||||||||||||||||||||||||||
| Elevance Health Inc. | |||||||||||||||||||||||||||||
| Intuitive Surgical Inc. | |||||||||||||||||||||||||||||
| Medtronic PLC | |||||||||||||||||||||||||||||
| UnitedHealth Group Inc. | |||||||||||||||||||||||||||||
Based on: 10-Q (reporting date: 2016-09-30), 10-Q (reporting date: 2016-06-30), 10-K (reporting date: 2016-03-31), 10-Q (reporting date: 2015-12-31), 10-Q (reporting date: 2015-09-30), 10-Q (reporting date: 2015-06-30), 10-K (reporting date: 2015-03-31), 10-Q (reporting date: 2014-12-31), 10-Q (reporting date: 2014-09-30), 10-Q (reporting date: 2014-06-30), 10-K (reporting date: 2014-03-31), 10-Q (reporting date: 2013-12-31), 10-Q (reporting date: 2013-09-30), 10-Q (reporting date: 2013-06-30), 10-K (reporting date: 2013-03-31), 10-Q (reporting date: 2012-12-31), 10-Q (reporting date: 2012-09-30), 10-Q (reporting date: 2012-06-30), 10-K (reporting date: 2012-03-31), 10-Q (reporting date: 2011-12-31), 10-Q (reporting date: 2011-09-30), 10-Q (reporting date: 2011-06-30).
1 Data adjusted for splits and stock dividends.
2 Q2 2017 Calculation
BVPS = Total McKesson Corporation stockholders’ equity ÷ No. shares of common stock outstanding
= ÷ =
3 Closing price as at the filing date of McKesson Corp. Quarterly or Annual Report.
4 Q2 2017 Calculation
P/BV ratio = Share price ÷ BVPS
= ÷ =
5 Click competitor name to see calculations.
- Share Price Trend
- The share price exhibited an overall upward trajectory from June 2011 to September 2016. Beginning at $79.60, it rose steadily with some fluctuations, reaching a peak of approximately $229.55 in March 2015. Following this high point, there was a marked decline through to September 2016, where the share price decreased to $160.50. This pattern indicates a period of significant growth followed by a notable correction or consolidation phase.
- Book Value per Share (BVPS) Behavior
- The book value per share demonstrated a gradual and relatively steady increase across the same period, starting at $28.08 in June 2011 and advancing to $41.79 by September 2016. The BVPS showed minor fluctuations, particularly around March 2015, where a slight dip was observed before resuming its upward trend. Overall, this reflects consistent growth in the company's net asset value on a per-share basis.
- Price-to-Book Value Ratio (P/BV) Analysis
- The price-to-book value ratio showed notable variation, indicating changing market perceptions relative to the company’s net asset value. Initially, the ratio ranged near 2.6 to 3.2 from mid-2011 through early 2013. Subsequently, there was a significant increase, peaking at 6.64 by March 2015, corresponding with the peak share price, suggesting heightened investor optimism or overvaluation during this period. Afterward, the P/BV ratio declined steadily, settling around 3.84 in September 2016, indicative of a market reassessment to more conservative valuations relative to book value.