Cencora’s oncology push powers a new fiscal 2027 growth outlook

Cencora, Inc. (NYSE:COR) is entering fiscal 2027 with a larger oncology platform, higher earnings and a more ambitious specialty-healthcare growth profile. The company reported fiscal 2026 revenue of US$337.4 billion, up 5.0%, while adjusted diluted earnings per share rose 12.3% to US$17.97. It expects fiscal 2027 adjusted diluted EPS of US$19.40 to US$19.75, implying growth of roughly 8% to 10%.

OneOncology lifts quarterly profitability

The fourth quarter provided the clearest evidence of the earnings effect. Revenue increased 5.5% to US$88.4 billion, but adjusted diluted EPS climbed 21.4% to US$4.66. Adjusted operating income rose 22.1% to US$1.25 billion, with the margin expanding to 1.41% from 1.22% a year earlier.

GAAP diluted EPS was US$2.71, compared with a loss of US$1.75 in the prior-year quarter. That comparison was heavily affected by a US$723.9 million PharmaLex goodwill impairment charge in the earlier period, so the adjusted result offers the cleaner view of underlying year-on-year movement. Cencora said the February 2026 acquisition of OneOncology helped lift gross profit, although increased GLP-1 sales partly diluted margins because those products carry lower gross margins.

Specialty services become the growth engine

From the first quarter of fiscal 2027, Cencora will report Pharmaceutical Distribution and Services separately from Specialty Pharmaceutical and Provider Services. The new specialty segment includes physician-practice distribution, management services organisations, World Courier, third-party logistics, Innomar and selected PharmaLex operations.

The distinction matters because the company is forecasting materially different growth rates across the businesses. Pharmaceutical Distribution and Services is expected to produce 4% to 6% revenue growth and 2% to 4% operating-income growth in fiscal 2027. Specialty Pharmaceutical and Provider Services is expected to grow revenue by 9% to 14% and operating income by 18% to 21%. Cencora’s long-term targets call for mid-single-digit operating-income growth in distribution and mid-teens growth in specialty services.

Transactions reshape the fiscal 2027 forecast

The guidance is not a like-for-like projection of the existing portfolio. Cencora’s assumptions include the sale of its Profarma equity interest in the first fiscal quarter and the closing of the MWI Animal Health merger with Covetrus on March 31, 2027. The company also has a definitive agreement to acquire American Oncology Network, a physician-led network of more than 350 oncology providers across 21 states.

Those transactions help explain why the forecast shows “Other” revenue falling from US$8.7 billion in fiscal 2026 to about US$3.5 billion, while the company still expects consolidated revenue growth of 3% to 5%. Cencora is guiding to adjusted operating income growth of 4% to 6%, adjusted free cash flow of about US$3.5 billion and capital expenditure of roughly US$1.0 billion. Fiscal 2026 adjusted free cash flow was US$3.8 billion.

Dividend rises as acquisition debt remains higher

The board declared a quarterly dividend of US$0.66 per share, a 10% increase from US$0.60. Cencora also repurchased US$1.0 billion of stock during fiscal 2026, while weighted average diluted shares fell 0.6% to 194.1 million.

The balance sheet carries the cost of expansion. Long-term debt rose to US$11.1 billion at September 30 from US$7.5 billion a year earlier, after Cencora issued debt and took on term loans to fund part of the OneOncology acquisition. Net interest expense increased 68.0% for the year to US$489.9 million, and fiscal 2027 guidance allows for US$490 million to US$510 million. The earnings outlook is therefore being delivered alongside a higher financing burden and lower expected cash generation.