CVS Health Corp. (NYSE: CVS) apparently wanted to have its turn at the dividend hike and stock buyback game. The pharmacy giant announced Tuesday that it has decided to increase its common stock dividend by 27%, and it added a massive share buyback plan as well. Dividend hikes and stock buybacks seem to be contagious, and the company also gave guidance for 2015 at its annual analyst day meeting.

CVS said that some of its cash will be used to invest in the business via strategic bolt-on acquisitions, and the rest of its cash will be returned to shareholders and will be used for “value-enhancing share repurchases.” The 27% dividend increase will be a hike to $0.35 per share per quarter, versus a prior $0.30 rate. This comes to a $1.40 annualized payout, and the yield is moving from roughly 1.30% up to 1.55%.

CVS also announced a new $10 billion that can be used for share buybacks. As far as the $10 billion is concerned, the plan is effective immediately and is expected to be completed over a multiyear period. The company said that this plan is to be combined with approximately $2.7 billion that remains on the share repurchase program approved by the board of directors back in 2013. All in all, this will makes a total of approximately $12.7 billion available for share repurchases. CVS now has a market cap of nearly $104 billion.

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Other issues covered were expectations of free cash flow to be between $5.9 billion and $6.2 billion, and cash from operations expected to be between $7.6 billion and $7.9 billion. On guidance, CVS said:

The company expects to deliver adjusted earnings per share from continuing operations of $5.05 to $5.19 in 2015, an increase of 12.5% to 15.75% (excluding the loss on early extinguishment of debt in 2014), and GAAP diluted earnings per share from continuing operations of $4.77 to $4.91 per share. The company also expects to generate substantial free cash flow of $5.9 billion to $6.2 billion in 2015, and cash from operations of $7.6 billion to $7.9 billion in 2015. This guidance assumes the completion of $6 billion in share repurchases during 2015.

For 2015, Thomson Reuters has the consensus estimates at $5.11 in earnings per share and $146.1 billion in revenues.

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CVS shares closed at $89.87 on Monday, and the stock was indicated just above $90 in the early hours of Tuesday. CVS has a 52-week trading range of $64.95 to $92.00 and a consensus price target of $92.30. Investors may take note that the highest analyst price target at the time the news broke was $103.00 per share, while the lowest analyst price target for the stock was all the way down at $70.

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