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With a market cap of $64.8 billion, CVS Health Corporation (CVS) is a leading pharmacy innovation company providing a wide range of health solutions in the United States. With offerings that span pharmacy benefit management, retail and specialty pharmacy, disease management programs, and consumer wellness services, CVS Health serves employers, insurers, government groups, and individuals through its various brands, including CVS Caremark, CarePlus, and SilverScript.
The Woonsocket, Rhode Island-based company is expected to announce its fiscal Q4 earnings results before the market opens on Wednesday, Feb. 12. Ahead of this event, analysts expect CVS to report a profit of $0.94 per share, down 55.7% from $2.12 per share in the year-ago quarter. The company has surpassed Wall Street's earnings estimates in three of the last four quarters while missing on another occasion. In Q3, CVS exceeded the consensus EPS estimate by 1.9%.
For fiscal 2024, analysts predict the drugstore chain and pharmacy benefits manager to report an EPS of $5.22, down 40.3% from $8.74 in fiscal 2023. Despite this setback, EPS is expected to rebound with a 16.7% year-over-year growth, reaching $6.09 in fiscal 2025.
Shares of CVS have dipped 32.7% over the past 52 weeks, lagging behind both the S&P 500 Index's ($SPX) 22% surge and the Health Care Select Sector SPDR Fund's (XLV) marginal rise over the same period.
Shares of CVS surged 11.3% on Nov. 6 due to better-than-expected Q3 earnings results, with an adjusted EPS of $1.09 and revenue of $95.4 billion. Additionally, the company reported a 6.3% year-over-year revenue increase and a 25.5% rise in Health Care Benefits segment revenue to $33 billion. CVS also announced new executive changes, including the appointment of Steve Nelson to lead Aetna, which added to investor confidence. The implementation of a restructuring plan, which included $1.2 billion in restructuring charges, further strengthened the company's position.
Analysts' consensus view on CVS Health’s stock is cautiously optimistic, with a "Moderate Buy" rating overall. Among 23 analysts covering the stock, 14 recommend "Strong Buy," two suggest "Moderate Buy," and seven indicate “Hold.” This configuration is more bullish than three months ago, with 12 analysts suggesting a "Strong Buy."
As of writing, CVS is trading below the average analyst price target of $64.91.
