What to Expect When CVS Reports Wednesday

February 19, 2019 by 247chrislange

CVS Health Corp. (NYSE: CVS) is scheduled to release its fourth-quarter financial results before the markets open on Wednesday. The consensus estimates from Thomson Reuters are calling for $2.05 in earnings per share (EPS) and $54.58 billion in revenue. The same period of last year reportedly had $1.92 in EPS and $48.38 billion in revenue.

In mid-January, CVS announced that it will be parting ways with megastore Walmart. Specifically, Walmart has opted to leave the CVS Caremark pharmacy benefit management commercial and Managed Medicaid retail pharmacy networks.

Ultimately this came down to a price dispute, but what else is new in how Walmart deals with its business partners.

Note that this transition does not impact Walmart’s participation in the CVS Caremark Medicare Part D pharmacy network. Additionally, Walmart’s Sam’s Club division remains in the CVS Caremark pharmacy networks.

Walmart’s termination from the CVS Caremark commercial and Managed Medicaid retail pharmacy networks is not expected to have a material impact on the financial results of CVS in 2019. Currently, less than 5% of affected CVS Caremark members use Walmart exclusively to fill their prescriptions.

Overall, CVS has underperformed the broad markets with its stock up only 6% year to date. In the past 52 weeks, the stock is actually flat.

A few analysts weighed in on CVS ahead of the report:

  • UBS Group has a Buy rating with a $75 price target.
  • Cantor Fitzgerald has a Buy rating and a $96 price target.
  • Merrill Lynch has a Buy rating with a $92 price target.
  • Barclays has an Overweight rating with a $91 target.
  • Leerink Swann has an Outperform rating.
  • Goldman Sachs has a Neutral rating and an $87 target.

Shares of CVS were last seen trading at $69.81, in a 52-week range of $60.14 to $82.15. The stock has a consensus price target of $88.57.

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