McKesson (MCK) Stock Forecast & Price Target

McKesson is well positioned because its dominant North American distribution scale, serving over one-third of medications in North America with 99.9% order accuracy, supports durable recurring volume from a market where the top three wholesalers control over 90% of U.S. pharmaceutical distribution. Its outlook is strengthened by specialty-drug and GLP-1 growth, with specialty expected to exceed 55% of total drug spending by 2028, while the company’s higher-margin oncology, biopharma, and prescription technology services deepen customer integration and raise switching costs. Strong execution is also visible in fiscal 2025, when McKesson generated $359.1 billion of revenue, $5.6 billion of adjusted EBIT, and $33.05 of EPS, backed by a fortress balance sheet and roughly 120% free-cash-flow conversion.

McKesson is facing a deteriorating risk/reward profile because employer coverage erosion for GLP-1 drugs threatens a meaningful revenue stream, with 6% of large employers already dropping coverage in 2026 and another ~10% planning to do so in 2027, while GLP-1 prior authorizations represent 9.5%-11.5% of RxTS revenue (~$560-$660M). The business also remains exposed to structural margin pressure from razor-thin distribution economics, as fiscal 2025 adjusted gross margin fell 40 basis points to 3.6% and may erode further, leaving limited room to absorb supply chain, input cost, or competitive pressure. On top of that, the 2028 IRA-driven Part B drug price negotiations on about $28B of Medicare spend could cut prices 40%-60%, while customer concentration and ongoing opioid-related litigation add further uncertainty to earnings durability.