Shares of Cardinal Health (NYSE:CAH) gained over 11% today after the healthcare company reported solid fiscal second-quarter 2020 operating results and raised its fiscal full-year 2020 guidance.
The business reported quarterly revenue growth of 5% compared to the year-ago period. Cardinal Health received a significant earnings boost from its generic pharmaceuticals portfolio, which is surprising considering generic drugs have presented challenges to many companies across the industry due to increased competition, lower selling prices, and mounting legal issues.
As of 1:12 p.m. EST, the pharma stock had settled to a 12.1% gain.
Cardinal Health reports two segments: pharmaceutical and medical. In the fiscal second quarter of 2020, the pharmaceutical business generated revenue of $35.7 billion and income of $462 million, while the medical segment reported revenue of $4 billion and income of $195 million.
The company reported total revenue of $39.7 billion and adjusted earnings per share (EPS) of $1.52. Both quarterly totals beat Wall Street's expectations for $39.4 billion in sales and $1.22 in adjusted EPS, according to numbers compiled by Yahoo! Finance.
While Cardinal Health reported a 34% decrease in quarterly operating income compared to the year-ago period, investors didn't seem to mind. Instead, they seem pleased that management raised fiscal full-year 2020 guidance for adjusted EPS to a midpoint of $5.30, up from a previous midpoint of $4.97.
Shares of Cardinal Health have surged in recent months since bottoming out in late 2019. Although there's plenty of ground to make up before the stock can threaten its 10-year peak of about $90 per share, investors are cautiously optimistic that the business is heading in the right direction.