Can Specialty and GLP-1 Momentum Support Cencora's Q3 Results?

Cencora COR is slated to report third-quarter fiscal 2025 results on Aug. 6, before market open.

In the last reported quarter, the company delivered an earnings surprise of 8.33%. COR’s earnings beat estimates in each of the trailing four quarters, delivering an average surprise of 6%.

Cencora’s Q3 Estimates

The Zacks Consensus Estimate for revenues is pegged at $80.33 billion, up 8.2% from the prior-year quarter’s level. The consensus mark for earnings is pinned at $3.78 per share, indicating an improvement of 13.2% from the prior-year quarter’s figure.

Factors to Consider Before COR Reports

Cencora has entered the fiscal third quarter with solid momentum, mainly driven by its U.S. Healthcare Solutions segment. This segment delivered $68.3 billion in revenues in the second quarter, marking an 11% year-over-year increase. Growth was supported by strong demand for specialty medicines, including GLP-1 therapies, and solid performance across physician practices and health systems. The company has already raised its full-year operating income outlook for this segment, and the fiscal third quarter is likely to reflect continued benefit from this strong first-half performance.

Specialty products remain a key growth area. In the fiscal second quarter, operating income in the U.S. segment rose 23%, helped by expanding use of biosimilars and increased services for specialty providers. Although GLP-1 revenue was up 36 percent year over year, it declined 10% compared to the prior quarter due to seasonal factors and market normalization. In the fiscal third quarter, specialty volumes are likely to remain strong, and the overall product mix is expected to support healthy profit margins, even if revenue growth moderates slightly from earlier levels.

Our model expects revenues for this segment to be $73.1 billion. Adjusted operating income is estimated to be $833.7 million.

Performance in the International Healthcare Solutions segment is likely to remain more modest in the fiscal third quarter. This segment generated $7.2 billion in revenue last quarter, growing 1% on a reported basis and 6% in constant currency. However, operating income declined 17%, mostly due to continued weakness in clinical trial logistics and lower demand for consulting projects. The company has lowered full-year expectations for this segment, and fiscal third-quarter results are likely to reflect ongoing softness, particularly in higher-margin service lines.

COR’s acquisition of Retina Consultants of America (RCA) is expected to play a growing role in the company’s margin profile. While RCA had little effect on overall revenue due to internal adjustments, it contributed positively to both gross and operating margins. In the fiscal third quarter, RCA’s impact is likely to become more visible as integration progresses. This move also supports Cencora’s broader strategy to expand in medical services and deepen relationships with specialty care providers. Over time, these investments are expected to strengthen the company’s market position and long-term earnings potential.

Our model expects the segment’s adjusted operating income and revenues to be $189.3 million and $7.3 billion, respectively.

Cencora, Inc. Price and EPS Surprise

Cencora, Inc. price-eps-surprise | Cencora, Inc. Quote

Earnings Beat Unlikely

Our proven model does not predict an earnings beat for Cencora this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the chances of an earnings beat.

Earnings ESP: Earnings ESP, which represents the difference between the Most Accurate Estimate and the Zacks Consensus Estimate, is 0.00%. You can uncover the best stocks to buy or sell before they're reported with our Earnings ESP Filter.

Zacks Rank: Cencora currently has a Zacks Rank #2.

Stocks Worth a Look

Cardinal Health, Inc. CAH, CorMedix Inc. CRMD and McKesson Corporation MCK are a few medical stocks worth considering, as these have the right combination of elements to beat on earnings this reporting cycle.

Cardinal Health has an Earnings ESP of +0.72% and a Zacks Rank of 2. CAH has an estimated long-term growth rate of 10.9%. You can see the complete list of today’s Zacks #1 Rank stocks here.

Cardinal Health’s earnings surpassed estimates in each of the trailing four quarters, with the average surprise being 10.3%.

CorMedix has an Earnings ESP of +27.12% and is a Zacks Rank #1 stock. CRMD has an estimated growth rate of 70.1% for 2026.

CorMedix’s earnings surpassed estimates in all the trailing four quarters, with the average surprise being 25.8%.

McKesson has an Earnings ESP of +0.14% and a Zacks Rank of 2. MCK has an estimated long-term growth rate of 13.3%.

McKesson’s earnings surpassed estimates in three of the trailing four quarters and missed once, with the average surprise being 3.9%.

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This article originally published on Zacks Investment Research (zacks.com).

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