Moody’s views Cardinal Health positively

Moody’s Ratings said it revised its outlook for Cardinal Health, Inc. to positive from stable and affirmed its Baa2 senior unsecured notes and Allegiance Corp.’s Baa2 backed senior unsecured rating.

“The revision in the outlook to positive reflects Cardinal's continued strong execution over the past few years. Moody's expects Cardinal to continue to benefit from strong pharmaceuticals utilization trends, and ongoing stabilization in the price of generic drugs, which will support Cardinal's earnings growth. The revision in outlook also reflects Moody's expectations that Cardinal will continue to improve profitability in its medical segment through execution of the medical improvement plan initiatives,” Moody’s said in a press release.

The agency said it expects Cardinal to operate with adjusted financial leverage in the 2.5x-3x range, (including opioid-related liabilities).

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