Cencora, Inc. (COR): A Bull Case Theory

We came across a bullish thesis on Cencora, Inc. on Stock Analysis Compilation’s Substack. In this article, we will summarize the bulls’ thesis on COR. Cencora, Inc.'s share was trading at $292.67 as of July 21^st. COR’s trailing and forward P/E were 33.87 and 16.81, respectively according to Yahoo Finance.

Cencora, Inc. stands as a critical pillar of the healthcare ecosystem, operating as one of the world’s largest pharmaceutical distribution companies and serving as an indispensable link between drug manufacturers and tens of thousands of healthcare providers, including pharmacies, hospitals, and clinics. Its business model benefits from the oligopolistic structure of the U.S. pharmaceutical distribution industry, where Cencora and two primary competitors control the vast majority of the market.

This triopoly is protected by immense logistical complexity, strict regulatory requirements, and deep customer integration, creating near-insurmountable barriers to entry. Leveraging its vast scale, Cencora achieves significant purchasing power and operational leverage, enabling it to operate on thin margins while generating robust and highly predictable cash flows. The essential, non-discretionary nature of distributing life-saving medicines ensures recession-proof demand and positions the company for steady, compounding growth.

Cencora has deepened its competitive advantage through strategic partnerships, most notably with Walgreens Boots Alliance, providing a stable and recurring revenue base. Beyond its core operations, the company has successfully expanded into specialty pharmaceuticals, a fast-growing segment requiring high expertise and serving complex therapies for chronic and rare diseases, further enhancing growth potential and margins.

Management’s disciplined approach to capital allocation, evidenced by consistent investment in logistics and technology infrastructure, underscores a focus on efficiency and long-term value creation. Combined with shareholder-friendly capital returns through dividends and repurchases, Cencora’s durable market position, operational excellence, and resilient business model make it a best-in-class enterprise with a long runway for sustainable success.

Previously, we covered a bullish thesis on Cencora, Inc. (COR) by Hidden Market Gems in April 2025, highlighting its resilience as a domestic, tariff-proof pharmaceutical distributor with stable margins and immunity to trade tensions. The stock has appreciated about 7% as investors recognized its defensive profile. Stock Analysis Compilation shares a similar view but emphasizes its oligopolistic market structure, operational scale, and long-term growth prospects.

Cencora, Inc. is not on our list of the 30 Most Popular Stocks Among Hedge Funds. As per our database, 58 hedge fund portfolios held COR at the end of the first quarter which was 58 in the previous quarter. While we acknowledge the potential of COR as an investment, we believe certain AI stocks offer greater upside potential and carry less downside risk. If you're looking for an extremely undervalued AI stock that also stands to benefit significantly from Trump-era tariffs and the onshoring trend, see our free report on the best short-term AI stock.

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Disclosure: None.