Munger Mode rating: 2 out of 5 — Sell. Our own rating from the research report below, on business quality first: moat durability and management, with price separating the top three.
Warren here, with Charlie's voice in my ear. Cardinal Health is a company we understand thoroughly — we've watched the drug distribution oligopoly for four decades — and that familiarity is precisely why we cannot call it a wonderful business. It is an average business enjoying an exceptional moment: earnings compounding at 30%+, a stock that has quintupled from its 2022 lows, and a valuation re-rating from 10x earnings to 19x forward earnings. The oligopoly is real and durable. But the economics are those of a toll collector who keeps 3.8 cents of every dollar that crosses the bridge and hands most of that back to the bridge's largest users.
Recent filings analysed: 8-K (2026-08-11), 8-K (2026-08-11), 10-K (2026-08-11), 8-K (2026-08-05).
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