Cardinal Health's $1.9 Billion Urology Bet Sends Shares Sliding -- But Could Spark Long-Term Growth

Cardinal Health (NYSE:CAH) is making another big move in specialty healthcare, agreeing to acquire Solaris Health for $1.9 billion. The deal builds on the company's growing footprint in urology, a space CEO Jason Hollar describes as an attractive specialty for the business. This acquisition follows other recent plays in the sector, including the purchase of Academic Urology & Urogynecology. Solaris Health brings a network of more than 750 providers across 14 states, positioning Cardinal to further strengthen its multispecialty strategy.

Warning! GuruFocus has detected 3 Warning Signs with CAH.

Management paired the announcement with an upgrade to its fiscal 2026 adjusted earnings per share forecast, now expected at $9.30 to $9.50 above analyst expectations. The Dublin, Ohio-based healthcare giant, known for its pharmaceutical distribution, medical product manufacturing, and home-health services, also delivered fiscal fourth-quarter results that topped EPS estimates, with revenue roughly in line with consensus.

The market's reaction was less enthusiastic in the short term, with shares down nearly 10% on the news and since then has bounced back a bit. Currently, stock remains up over 25%. For investors, the short-term pullback could reflect caution over integration risks and near-term costs, while the long-term view hinges on whether Cardinal can unlock the growth potential it sees in urology and multispecialty care.

This article first appeared on GuruFocus.

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