CVS Health Corporation (CVS)

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Earnings Preview: CVS Health Corp. (NYSE: CVS)
By: 24/7 Wall St. | February 6, 2023

• Here is a look at what analysts expect when the following three firms post their results first thing Wednesday morning.

CVS Health

The country’s third-largest provider of health care plans, CVS Health Corp. (NYSE: CVS) has seen its stock price rise dive by almost 21% in the past 12 months. Bloomberg reported last month that CVS is in discussions to acquire Oak Street Health’s brick-and-mortar centers for Medicare patients with low incomes and chronic health issues. New competition from Amazon for prescription drug sales may force CVS to protect its flank and put its diversification plans on hold. That competition is the primary reason for a drop of around 14% in CVS’s share price in just the past three months.

Analysts remain bullish on the stock, with 19 of 27 brokerages having a Buy or Strong Buy rating. The rest rate the shares at Hold. At a recent price of around $85.50 a share, the upside potential based on a median price target of $115.55 is about 35%. At the high price target of $130, the implied upside is 52%.

The consensus revenue estimate for the third quarter is $76.37 billion, which would be down 5.9% sequentially and by 0.3% year over year. Adjusted EPS are forecast at $1.93, down 10.1% sequentially and 2.5% lower year over year. For the full 2022 fiscal year, analysts are looking for EPS of $8.64, up 2.9%, and revenue of $314.7 billion, up about 7.7% year over year.
CVS stock trades at about 9.9 times expected 2022 EPS, 9.6 times estimated 2023 earnings of $8.86 and 8.9 times estimated 2024 earnings of $9.61 per share. The stock’s 52-week trading range is $84.82 to $111.25. CVS Health pays an annual dividend of $2.42 (yield of 2.82%). Total shareholder return for the past 12 months was negative 19.38%.

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