CVS Health (CVS)
Market Price (9/18/2026): $90.31 | Market Cap: $115.5 BilInvestor Relations Sector: Health Care | Industry: Health Care Services
CVS Health (CVS)
Market Price (9/18/2026): $90.31Market Cap: $115.5 BilSector: Health CareIndustry: Health Care Services
Investment Highlights Why It Matters Detailed financial logic regarding cash flow yields vs trend-riding momentum.
Attractive yieldTotal YieldTotal Yield = Earnings Yield + Dividend Yield, Earnings Yield = Net Income / Market Cap Dividend Yield = Total Dividends / Market Cap is 7.2%, Dividend Yield is 3.0%, ERPEquity Risk Premium (ERP) = Total Yield - Risk Free Rate, Reflects the premium above risk free assets offered by the investment. is 3.1%, FCF Yield is 10% Stock buyback supportStock Buyback 3Y Total is 3.0 Bil Attractive cash flow generationCFO LTM is 15 Bil, FCF LTM is 12 Bil Low stock price volatilityVol 12M is 31% Megatrend and thematic driversMegatrends include Digital Health & Telemedicine, and Aging Population & Chronic Disease. Themes include Telehealth Platforms, Remote Patient Monitoring, Show more. | Weak multi-year price returns3Y Excs Rtn is -28% | Debt is significantNet D/ENet Debt/Equity. Debt net of cash. Negative indicates net cash. Equity is taken as the Market Capitalization is 54% Key risksCVS key risks include [1] elevated Medicare costs pressuring its Health Care Benefits segment, Show more. |
| Attractive yieldTotal YieldTotal Yield = Earnings Yield + Dividend Yield, Earnings Yield = Net Income / Market Cap Dividend Yield = Total Dividends / Market Cap is 7.2%, Dividend Yield is 3.0%, ERPEquity Risk Premium (ERP) = Total Yield - Risk Free Rate, Reflects the premium above risk free assets offered by the investment. is 3.1%, FCF Yield is 10% |
| Stock buyback supportStock Buyback 3Y Total is 3.0 Bil |
| Attractive cash flow generationCFO LTM is 15 Bil, FCF LTM is 12 Bil |
| Low stock price volatilityVol 12M is 31% |
| Megatrend and thematic driversMegatrends include Digital Health & Telemedicine, and Aging Population & Chronic Disease. Themes include Telehealth Platforms, Remote Patient Monitoring, Show more. |
| Weak multi-year price returns3Y Excs Rtn is -28% |
| Debt is significantNet D/ENet Debt/Equity. Debt net of cash. Negative indicates net cash. Equity is taken as the Market Capitalization is 54% |
| Key risksCVS key risks include [1] elevated Medicare costs pressuring its Health Care Benefits segment, Show more. |
Qualitative Assessment
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CVS Health (CVS) stock has remained largely at the same level since 5/31/2026 because of the following key factors:
1. Strong Fiscal Q2 2026 Performance and Raised Full-Year Guidance.
CVS Health reported robust financial results for its fiscal Q2 2026 (ended June 30, 2026) on August 5, 2026, exceeding analyst expectations. The company announced an adjusted earnings per share (EPS) of $2.58, significantly beating the consensus estimate of $1.87. Total revenues also surpassed expectations, reaching $106.1 billion, an increase of 7.3% year-over-year, compared to an estimated $100.03 billion. This strong performance, driven by growth across all operating segments, led CVS Health to raise its full-year 2026 adjusted EPS guidance to a range of $7.90 to $8.10, up from its previous projection of $7.30 to $7.50. While this positive news typically drives stock growth, its impact was largely balanced by other factors during the specified period.
2. Persistent Industry Headwinds and Regulatory Scrutiny.
Despite strong company-specific results, CVS Health's stock trend was tempered by ongoing broader industry challenges and regulatory concerns. The company acknowledged continued elevated healthcare cost trends and potential macroeconomic headwinds. Specifically, market pressures from expensive medications, increasing high-cost claims, and managing chronic conditions kept overall healthcare costs elevated. Furthermore, regulatory uncertainty, particularly surrounding Pharmacy Benefit Manager (PBM) re-regulation and drug pricing rules, remained a significant threat, adding caution to the investor outlook and likely offsetting some of the positive earnings momentum. Challenges within a major federal drug discount program were also noted as pressuring earnings in the Health Services segment.
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CVS Health (CVS) stock has remained largely at the same level since 5/31/2026 because of the following key factors:
1. Strong Fiscal Q2 2026 Performance and Raised Full-Year Guidance.
CVS Health reported robust financial results for its fiscal Q2 2026 (ended June 30, 2026) on August 5, 2026, exceeding analyst expectations. The company announced an adjusted earnings per share (EPS) of $2.58, significantly beating the consensus estimate of $1.87. Total revenues also surpassed expectations, reaching $106.1 billion, an increase of 7.3% year-over-year, compared to an estimated $100.03 billion. This strong performance, driven by growth across all operating segments, led CVS Health to raise its full-year 2026 adjusted EPS guidance to a range of $7.90 to $8.10, up from its previous projection of $7.30 to $7.50. While this positive news typically drives stock growth, its impact was largely balanced by other factors during the specified period.
2. Persistent Industry Headwinds and Regulatory Scrutiny.
Despite strong company-specific results, CVS Health's stock trend was tempered by ongoing broader industry challenges and regulatory concerns. The company acknowledged continued elevated healthcare cost trends and potential macroeconomic headwinds. Specifically, market pressures from expensive medications, increasing high-cost claims, and managing chronic conditions kept overall healthcare costs elevated. Furthermore, regulatory uncertainty, particularly surrounding Pharmacy Benefit Manager (PBM) re-regulation and drug pricing rules, remained a significant threat, adding caution to the investor outlook and likely offsetting some of the positive earnings momentum. Challenges within a major federal drug discount program were also noted as pressuring earnings in the Health Services segment.
3. Aetna's Margin Recovery Counterbalanced by Membership Declines.
The Health Care Benefits segment (Aetna) demonstrated considerable improvement, with adjusted operating income nearly doubling year-over-year in fiscal Q2 2026, primarily due to successful margin recovery initiatives. This strong profitability improvement was a key positive. However, this was partially offset by a decline of approximately 600,000 members since the end of 2025, largely attributed to CVS Health's strategic exit from unprofitable individual exchange businesses and disciplined renewals. The market appears to be weighing the improved operational efficiency and profitability per member against the overall reduction in the member base.
4. Analyst Consensus and Valuation.
As of mid-September 2026, analysts maintained a "Moderate Buy" to "Buy" consensus rating for CVS Health, with an average 12-month price target ranging from $110.76 to $116.00. While these targets suggested an upside from the stock's trading range of approximately $94 to $95 during much of the period, the relatively stable stock movement implies that the market had largely factored in the company's strong performance and future outlook. The stock's forward P/E ratio of approximately 11x, compared to a trailing P/E of 25x, indicates that investors were looking at future earnings potential while also potentially pricing in the acknowledged risks, thus contributing to the stock remaining largely at the same level.
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Stock Movement Drivers
Fundamental Drivers
The -0.2% change in CVS stock from 5/31/2026 to 9/17/2026 was primarily driven by a -39.9% change in the company's P/E Multiple.| (LTM values as of) | 5312026 | 9172026 | Change |
|---|---|---|---|
| Stock Price ($) | 90.42 | 90.27 | -0.2% |
| Change Contribution By: | |||
| Total Revenues ($ Mil) | 407,905 | 415,086 | 1.8% |
| Net Income Margin (%) | 0.7% | 1.2% | 63.9% |
| P/E Multiple | 39.3 | 23.6 | -39.9% |
| Shares Outstanding (Mil) | 1,273 | 1,279 | -0.5% |
| Cumulative Contribution | -0.2% |
Market Drivers
5/31/2026 to 9/17/2026| Return | Correlation | |
|---|---|---|
| CVS | -0.2% | |
| Market (SPY) | 0.8% | -5.1% |
| Sector (XLV) | 12.9% | 23.4% |
Fundamental Drivers
The 14.7% change in CVS stock from 2/28/2026 to 9/17/2026 was primarily driven by a 167.9% change in the company's Net Income Margin (%).| (LTM values as of) | 2282026 | 9172026 | Change |
|---|---|---|---|
| Stock Price ($) | 78.72 | 90.27 | 14.7% |
| Change Contribution By: | |||
| Total Revenues ($ Mil) | 402,067 | 415,086 | 3.2% |
| Net Income Margin (%) | 0.4% | 1.2% | 167.9% |
| P/E Multiple | 56.5 | 23.6 | -58.2% |
| Shares Outstanding (Mil) | 1,270 | 1,279 | -0.7% |
| Cumulative Contribution | 14.7% |
Market Drivers
2/28/2026 to 9/17/2026| Return | Correlation | |
|---|---|---|
| CVS | 14.7% | |
| Market (SPY) | 11.5% | 7.8% |
| Sector (XLV) | 5.8% | 23.1% |
Fundamental Drivers
The 27.3% change in CVS stock from 8/31/2025 to 9/17/2026 was primarily driven by a 19.2% change in the company's P/E Multiple.| (LTM values as of) | 8312025 | 9172026 | Change |
|---|---|---|---|
| Stock Price ($) | 70.90 | 90.27 | 27.3% |
| Change Contribution By: | |||
| Total Revenues ($ Mil) | 386,641 | 415,086 | 7.4% |
| Net Income Margin (%) | 1.2% | 1.2% | 0.5% |
| P/E Multiple | 19.8 | 23.6 | 19.2% |
| Shares Outstanding (Mil) | 1,266 | 1,279 | -1.0% |
| Cumulative Contribution | 27.3% |
Market Drivers
8/31/2025 to 9/17/2026| Return | Correlation | |
|---|---|---|
| CVS | 27.3% | |
| Market (SPY) | 19.2% | 6.1% |
| Sector (XLV) | 24.4% | 25.1% |
Fundamental Drivers
The 55.3% change in CVS stock from 8/31/2023 to 9/17/2026 was primarily driven by a 34.8% change in the company's Net Income Margin (%).| (LTM values as of) | 8312023 | 9172026 | Change |
|---|---|---|---|
| Stock Price ($) | 58.12 | 90.27 | 55.3% |
| Change Contribution By: | |||
| Total Revenues ($ Mil) | 339,204 | 415,086 | 22.4% |
| Net Income Margin (%) | 0.9% | 1.2% | 34.8% |
| P/E Multiple | 25.1 | 23.6 | -6.1% |
| Shares Outstanding (Mil) | 1,283 | 1,279 | 0.3% |
| Cumulative Contribution | 55.3% |
Market Drivers
8/31/2023 to 9/17/2026| Return | Correlation | |
|---|---|---|
| CVS | 55.3% | |
| Market (SPY) | 75.3% | 13.9% |
| Sector (XLV) | 32.7% | 30.7% |
Price Returns Compared
| 2021 | 2022 | 2023 | 2024 | 2025 | 2026 | Total [1] | |
|---|---|---|---|---|---|---|---|
| Returns | |||||||
| CVS Return | 55% | -8% | -13% | -41% | 84% | 18% | 62% |
| Peers Return | 24% | 15% | -2% | 0% | -2% | 17% | 62% |
| S&P 500 Return | 27% | -19% | 24% | 23% | 16% | 10% | 101% |
Monthly Win Rates [3] | |||||||
| CVS Win Rate | 58% | 42% | 33% | 33% | 67% | 56% | |
| Peers Win Rate | 53% | 58% | 45% | 55% | 58% | 47% | |
| S&P 500 Win Rate | 75% | 42% | 67% | 75% | 67% | 44% | |
Max Drawdowns [4] | |||||||
| CVS Max Drawdown | -11% | -20% | -28% | -44% | -15% | -17% | |
| Peers Max Drawdown | -17% | -18% | -18% | -28% | -35% | -26% | |
| S&P 500 Max Drawdown | -5% | -25% | -10% | -8% | -19% | -9% | |
[1] Cumulative total returns since the beginning of 2021
[2] Peers: UNH, CI, ELV, HUM, WMT. See CVS Returns vs. Peers.
[3] Win Rate = % of calendar months in which monthly returns were positive
[4] Max drawdown represents maximum peak-to-trough decline within a year
[5] 2026 data is for the year up to 9/17/2026 (YTD)
How Low Can It Go
| Event | CVS | S&P 500 |
|---|---|---|
| Summer-Fall 2023 Five Percent Yield Shock | ||
| % Loss | -13.9% | -9.5% |
| % Gain to Breakeven | 16.1% | 10.5% |
| Time to Breakeven | 99 days | 24 days |
| 2023 SVB Regional Banking Crisis | ||
| % Loss | -25.2% | -6.7% |
| % Gain to Breakeven | 33.7% | 7.1% |
| Time to Breakeven | 855 days | 31 days |
| 2022 Inflation Shock & Fed Tightening | ||
| % Loss | -14.3% | -24.5% |
| % Gain to Breakeven | 16.7% | 32.4% |
| Time to Breakeven | 49 days | 427 days |
| 2020 COVID-19 Crash | ||
| % Loss | -27.1% | -33.7% |
| % Gain to Breakeven | 37.2% | 50.9% |
| Time to Breakeven | 239 days | 140 days |
| Q4 2018 Fed Policy Error / Growth Scare | ||
| % Loss | -20.7% | -19.2% |
| % Gain to Breakeven | 26.1% | 23.8% |
| Time to Breakeven | 711 days | 105 days |
| 2016-2017 Trump Reflation Bond Selloff | ||
| % Loss | -18.1% | -3.7% |
| % Gain to Breakeven | 22.0% | 3.9% |
| Time to Breakeven | 1638 days | 6 days |
In The Past
CVS Health's stock fell -8.6% during the 2025 US Tariff Shock. Such a loss loss requires a 9.5% gain to breakeven.
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Asset Allocation
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| Event | CVS | S&P 500 |
|---|---|---|
| 2023 SVB Regional Banking Crisis | ||
| % Loss | -25.2% | -6.7% |
| % Gain to Breakeven | 33.7% | 7.1% |
| Time to Breakeven | 855 days | 31 days |
| 2020 COVID-19 Crash | ||
| % Loss | -27.1% | -33.7% |
| % Gain to Breakeven | 37.2% | 50.9% |
| Time to Breakeven | 239 days | 140 days |
| Q4 2018 Fed Policy Error / Growth Scare | ||
| % Loss | -20.7% | -19.2% |
| % Gain to Breakeven | 26.1% | 23.8% |
| Time to Breakeven | 711 days | 105 days |
| 2010 Eurozone Sovereign Debt Crisis / Flash Crash | ||
| % Loss | -22.6% | -15.4% |
| % Gain to Breakeven | 29.1% | 18.2% |
| Time to Breakeven | 301 days | 125 days |
| 2008-2009 Global Financial Crisis | ||
| % Loss | -39.1% | -53.4% |
| % Gain to Breakeven | 64.3% | 114.4% |
| Time to Breakeven | 799 days | 1085 days |
In The Past
CVS Health's stock fell -8.6% during the 2025 US Tariff Shock. Such a loss loss requires a 9.5% gain to breakeven.
Preserve Wealth
Limiting losses and compounding gains is essential to preserving wealth.
Asset Allocation
Actively managed asset allocation strategies protect wealth. Learn more.
About CVS Health (CVS)
CVS Health is a leading diversified healthcare company in the United States, providing a wide array of health services. Its business is primarily structured around three core segments: health insurance, pharmacy benefit management, and retail pharmacy with integrated clinics. This comprehensive approach allows CVS Health to address various healthcare needs for a broad spectrum of customers and markets.
Through its Health Care Benefits segment, CVS Health offers traditional and consumer-directed health insurance products and related services to employer groups, individuals, college students, governmental units, and other health plans. The Pharmacy Services segment provides extensive pharmacy benefit management solutions, including plan design, formulary management, and specialty pharmacy services, primarily serving employers, insurance companies, unions, and government-sponsored plans. This segment also operates various specialized pharmacies for mail-order, compounding, and infusion services.
Finally, CVS Health's Retail/LTC segment operates a vast network of CVS Pharmacy retail locations where it sells prescription and over-the-counter drugs, consumer health and beauty products, and offers convenient healthcare services through its MinuteClinic walk-in medical clinics. This segment also distributes prescription drugs and provides related pharmacy consulting and services to long-term care facilities, further extending its reach to serve individual consumers and care institutions alike.
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A company combining the retail presence of Walgreens, the health insurance of UnitedHealthcare, and pharmacy benefit management like Express Scripts.
A healthcare giant like UnitedHealth Group, but with a massive retail pharmacy and clinic footprint akin to Walgreens.
It's like Walgreens and UnitedHealthcare merged, then added a major pharmacy benefit management arm.
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- Health Insurance Products: CVS Health offers various traditional and consumer-directed health insurance plans and related services.
- Pharmacy Benefit Management (PBM) Solutions: CVS Health provides pharmacy benefit management services, including formulary management, mail order, and specialty pharmacy services, to employers and health plans.
- Retail Pharmacy Sales: CVS Health sells prescription and over-the-counter drugs, as well as general consumer health and beauty products, through its retail stores.
- Specialty Pharmacy and Infusion Services: CVS Health provides specialized pharmacy services for complex medical conditions, including mail-order, compounding, and infusion services.
- MinuteClinic Walk-in Medical Services: CVS Health offers accessible healthcare services for minor illnesses and injuries through its MinuteClinic walk-in clinics.
- Long-Term Care (LTC) Pharmacy Services: CVS Health provides prescription drug distribution and related pharmacy consulting services to long-term care facilities.
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CVS Health serves a diverse customer base, primarily reaching individuals through various channels, including direct sales and through intermediary organizations. Based on the provided description, its major customer categories are:
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Individual Consumers: This includes people who directly purchase prescription drugs, over-the-counter medications, consumer health and beauty products at CVS retail locations and online. It also encompasses individuals seeking health care services through MinuteClinic walk-in medical clinics, as well as college students, part-time and hourly workers, and expatriates who may directly enroll in health insurance products.
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Employer Groups and Organizations: This category includes employers, labor groups, unions, government employee groups, and other sponsors of health benefit plans. These entities purchase health insurance products, pharmacy benefit management (PBM) solutions, and related services from CVS Health to provide to their employees, members, or constituents.
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Health Plans, Insurers, and Care Facilities: This category encompasses insurance companies, health plans, governmental units, government-sponsored plans, prescription drug plans, and Medicaid managed care plans. These organizations contract with CVS Health for services such as formulary management, retail pharmacy network management, mail order pharmacy, specialty pharmacy, infusion, and clinical services. Additionally, care facilities and other care settings purchase prescription drugs and related pharmacy consulting services from CVS Health's Retail/LTC segment.
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- Cencora (COR)
- Cardinal Health (CAH)
- McKesson Corporation (MCK)
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Key Risks to CVS Health (CVS)
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Regulatory and Reimbursement Pressures: CVS Health operates in a heavily regulated healthcare environment, making it vulnerable to changes in government policies, laws, and regulations, particularly concerning reimbursement rates for its government-sponsored programs like Medicare and Medicaid. Weakness in Medicare Advantage rates, specifically a proposed low increase for 2027, could undermine over one-third of CVS Health's revenue and hinder growth in this critical segment. Pharmacy reimbursement pressures further contribute to this risk.
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Intense Competition and Market Saturation: The company faces significant and increasing competition across all its segments from traditional pharmacy chains, other health insurers, pharmacy benefit managers, online retailers (including tech giants entering healthcare), and new healthcare providers. This competitive landscape necessitates continuous innovation and adaptation to maintain market share and relevance, potentially leading to pricing pressures and reduced profitability.
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Rising Medical Costs and Profit Margin Erosion: CVS Health is exposed to the risk of rising medical costs, particularly within its Health Care Benefits segment. Higher-than-expected medical expenses can significantly impact the company's already thin single-digit profit margins and lead to substantial financial consequences, especially in the absence of robust sales growth. Challenges such as unforeseen heightened utilization in Medicare Advantage further exacerbate these pressures.
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- Increased legislative and regulatory scrutiny of Pharmacy Benefit Managers (PBMs) could significantly impact the profitability and operating model of CVS Health's Pharmacy Services segment (CVS Caremark).
- The expansion of online prescription fulfillment services, particularly from major entrants like Amazon Pharmacy, poses a direct competitive threat to CVS Health's retail pharmacy and mail-order businesses by offering alternative, convenient, and potentially lower-cost prescription access.
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CVS Health Corporation operates in several large addressable markets within the United States.
Health Care Benefits
The U.S. health and medical insurance market, in which CVS Health's Health Care Benefits segment (Aetna) operates, is substantial. This market was valued at approximately USD 1.65 trillion in 2026 and is projected to grow to USD 2.15 trillion by 2031. Another estimate placed the market at USD 613.0 billion in 2024, expanding to USD 1161.7 billion by 2032. A further report valued the market at USD 469.8 billion in 2025.
Pharmacy Services
CVS Health's Pharmacy Services segment (CVS Caremark) participates in the U.S. pharmacy benefit management (PBM) market. This market was estimated at USD 519.45 billion in 2025 and is projected to reach approximately USD 921.52 billion by 2035. Other reports indicate the PBM market size was calculated at USD 459.65 billion in 2025, with a projection to reach around USD 1,041.11 billion by 2034. Additionally, the U.S. specialty pharmacy market, a key component of pharmacy services, saw an estimated $265 billion in dispensed pharmaceuticals in 2024.
Retail/LTC
In its Retail/LTC segment, CVS Health operates in several U.S. markets:
- Retail Pharmacy: The U.S. retail pharmacy market is estimated to reach US$ 670.6 billion in 2025 and is projected to grow to US$ 901.4 billion by 2032. Another source noted the market size as USD 670.5 billion in 2025. More broadly, the U.S. pharmacy market was valued at USD 643.4 billion in 2024 and is projected to reach USD 905.8 billion by 2033.
- MinuteClinic (Retail Clinics/Walk-in Clinics): The U.S. retail clinics market was valued at USD 2.44 billion in 2024 and is expected to grow from USD 2.71 billion in 2025 to USD 6.29 billion by 2033. Another estimate for the walk-in clinic market size in 2025 is $7.45 billion, with a projection to reach approximately $20 billion by 2033.
- Long-Term Care (LTC) Pharmacy Services: The U.S. long-term care pharmacy services market is estimated to be valued at USD 22.8 billion in 2025 and is expected to reach USD 38.7 billion by 2032.
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- Expansion of Health Services and Care Delivery: CVS Health anticipates significant revenue growth from its Health Services segment, particularly through the expansion and integration of acquired assets like Oak Street Health and Signify Health. The company plans to add 50 to 60 new Oak Street Health centers in 2024, and the new CVS Healthspire brand aims to simplify access to multi-payor capabilities, driving better outcomes and increased member value.
- Growth in Medicare Advantage Membership and Margin Recovery: The Medicare Advantage business, operated under its Aetna arm, is integral to CVS Health's strategy. Despite some challenges with elevated medical costs in 2024, CVS Health expects to add at least 800,000 new Medicare Advantage members in 2024 and anticipates Medicare Advantage margin recovery starting in 2025. This recovery is a key driver for strong earnings growth and a favorable long-term outlook.
- New Pharmacy Reimbursement Models: CVS Health is implementing new pharmacy reimbursement models, including CVS CostVantage for its retail pharmacies and CVS Caremark TrueCost for Pharmacy Benefit Manager (PBM) clients. These models, with CostVantage launching for commercial payors in 2025, are designed to create a more transparent, sustainable, and value-aligned approach to pharmacy reimbursement, reflecting the true net cost of prescription drugs.
- Optimization of Pharmacy and Consumer Wellness Segment: The Pharmacy and Consumer Wellness segment is expected to continue contributing to revenue growth through increased prescription volume, a favorable pharmacy drug mix, and the strategic integration of its retail pharmacies as a "front door" to the broader healthcare enterprise. The retail arm demonstrated strong revenue growth in 2023 and Q4 2024.
- Leveraging Technology and Integrated Platform for Enhanced Engagement: CVS Health is developing a fully integrated, AI-native platform, branded as "Engagement as a Service," to connect its various healthcare entities (Aetna, CVS Caremark, CVS Pharmacy, and Health Care Delivery). This initiative aims to transform consumer experiences, enhance engagement, lower healthcare costs, and unlock personalized products and services, ultimately driving greater lifetime member value.
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Share Repurchases
- CVS Health repurchased approximately $3.0 billion of common stock during the nine months ended September 30, 2024, and approximately $2.0 billion during the nine months ended September 30, 2023, under its 2021 Repurchase Program.
- As of February 10, 2026, the company completed repurchases of approximately $8.5 billion under the buyback announced on December 9, 2021.
- The Board of Directors authorized a $10.0 billion share repurchase program on November 17, 2022, with the full $10.0 billion remaining as of September 30, 2024.
Share Issuance
- CVS Health's shares outstanding for 2025 were 1.271 billion, a 0.71% increase from 2024.
- In November 2024, a one-time promotional equity award was granted to the CEO, consisting of stock options to acquire one million shares and stock-settled SARs with respect to 492,537 shares, with a grant price of $71.82 per share.
Outbound Investments
- CVS Health acquired Oak Street Health for $10.6 billion in February 2023.
- CVS Health acquired Signify Health for $8 billion in September 2022.
- In April 2024, CVS Health acquired Hella Health, a platform offering Medicare health insurance plans.
Capital Expenditures
- CVS Health's capital expenditures for fiscal years ending December 2021 to 2025 averaged $2.778 billion, with a peak of $3.031 billion in December 2023.
- The company plans a substantial $20 billion investment over the next decade, beginning in June 2025, to enhance technology and interoperability in healthcare delivery.
- A multi-year plan to close approximately 900 stores aims to refocus assets into HealthHUBs that offer expanded clinical services.
Peer Outperformance in Health Care Services
| Ticker | Name | Rev Growth 3Y Avg | P/E | 1Y | 3Y | 5Y | 5Y Gap |
|---|---|---|---|---|---|---|---|
| CVS | CVS Health | 7.0% | 23.6x | 25.9% | 43.2% | 24.6% | — |
| DGX | Quest Diagnostics | 7.0% | 25.9x | 38.2% | 108.6% | 76.2% | +52pp |
| DVA | DaVita | 6.1% | 14.0x | 43.0% | 83.5% | 50.6% | +26pp |
| Industry | Names | 1Y med | 3Y med | 5Y med | Top 3 by 5Y |
|---|---|---|---|---|---|
| Health Care Distributors | 7 | 7.8% | 77.2% | 101.1% | CAH 380% · MCK 334% · COR 164% |
| Managed Health Care | 8 | 40.9% | -1.4% | 1.5% | OSCR 83% · HQY 48% · ELV 17% |
| Health Care Services ← | 20 | 25.4% | 42.2% | -1.8% | HIMS 219% · RDNT 172% · DGX 76% |
| Health Care Facilities | 24 | 5.6% | 0.8% | -12.7% | NHC 274% · THC 259% · ENSG 127% |
| Health Care Equipment | 50 | -0.8% | -4.9% | -21.9% | POCI 10800% · UFPT 334% · GKOS 199% |
| Pharmaceuticals | 62 | -5.1% | 12.4% | -39.8% | LQDA 2442% · INDV 1175% · ETON 1012% |
| Health Care Supplies | 12 | 17.1% | -12.2% | -40.3% | LNTH 294% · HAE 53% · MMSI 19% |
| Life Sciences Tools & Services | 109 | 5.4% | -22.1% | -68.8% | SNWV 1586% · MEDP 231% · NTRA 190% |
| Health Care Technology | 21 | -25.5% | -51.1% | -79.7% | SPOK 72% · HSTM 1% · VEEV -13% |
| Biotechnology | 364 | 0.4% | -26.6% | -79.8% | DNTH 1198% · CELZ 1154% · ELVN 1077% |
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Peer Comparisons
| Peers to compare with: |
Financials
| Median | |
|---|---|
| Name | |
| Mkt Price | 325.61 |
| Mkt Cap | 102.7 |
| Rev LTM | 348,211 |
| Op Inc LTM | 17,844 |
| FCF LTM | 10,436 |
| FCF 3Y Avg | 7,138 |
| CFO LTM | 12,528 |
| CFO 3Y Avg | 9,231 |
Growth & Margins
| Median | |
|---|---|
| Name | |
| Rev Chg LTM | 6.9% |
| Rev Chg 3Y Avg | 7.9% |
| Rev Chg Q | 6.3% |
| QoQ Delta Rev Chg LTM | 1.5% |
| Op Inc Chg LTM | 10.1% |
| Op Inc Chg 3Y Avg | 7.6% |
| Op Mgn LTM | 3.9% |
| Op Mgn 3Y Avg | 3.8% |
| QoQ Delta Op Mgn LTM | 0.4% |
| CFO/Rev LTM | 3.7% |
| CFO/Rev 3Y Avg | 3.1% |
| FCF/Rev LTM | 3.0% |
| FCF/Rev 3Y Avg | 2.0% |
Valuation
| Median | |
|---|---|
| Name | |
| Mkt Cap | 102.7 |
| P/S | 0.4 |
| P/Op Inc | 11.9 |
| P/EBIT | 14.4 |
| P/E | 23.8 |
| P/CFO | 12.3 |
| Total Yield | 6.9% |
| Dividend Yield | 2.0% |
| FCF Yield 3Y Avg | 5.1% |
| D/E | 0.3 |
| Net D/E | 0.1 |
Returns
| Median | |
|---|---|
| Name | |
| 1M Rtn | -2.3% |
| 3M Rtn | -3.2% |
| 6M Rtn | 31.4% |
| 12M Rtn | 19.3% |
| 3Y Rtn | 0.4% |
| 1M Excs Rtn | -1.6% |
| 3M Excs Rtn | -7.0% |
| 6M Excs Rtn | 14.2% |
| 12M Excs Rtn | 4.5% |
| 3Y Excs Rtn | -71.2% |
Comparison Analyses
Segment Financials
Revenue by Segment| $ Mil | 2025 | 2024 | 2023 | 2022 | 2021 |
|---|---|---|---|---|---|
| Health Services | 190,425 | 173,605 | 186,843 | 169,576 | 153,892 |
| Health Care Benefits | 143,354 | 130,665 | 105,646 | 91,350 | 82,119 |
| Pharmacy & Consumer Wellness | 139,367 | 124,500 | 116,763 | 108,596 | 101,620 |
| Corporate/Other | 484 | 451 | 451 | 530 | 721 |
| Intersegment Eliminations | -71,563 | -56,412 | -51,927 | -47,585 | -46,241 |
| Total | 402,067 | 372,809 | 357,776 | 322,467 | 292,111 |
| $ Mil | 2025 | 2024 | 2023 | 2022 | 2021 |
|---|---|---|---|---|---|
| Health Services | 7,151 | 7,243 | 7,312 | 6,781 | 6,492 |
| Pharmacy & Consumer Wellness | 6,040 | 5,774 | 5,963 | 6,531 | 7,260 |
| Health Care Benefits | 2,939 | 307 | 5,577 | 6,338 | 5,110 |
| Office real estate optimization charges | -10 | -30 | -46 | -117 | 0 |
| Net realized capital losses | -44 | 117 | -497 | -320 | 176 |
| Health Care Delivery clinic closure charge | -83 | ||||
| Acquisition-related integration costs | -117 | -243 | -487 | -132 | |
| Loss on Accountable Care assets | -288 | -2,533 | 0 | ||
| Opioid litigation charge | -320 | -100 | |||
| Legacy litigation charges | -1,220 | ||||
| Corporate/Other | -1,687 | -1,348 | -1,318 | -1,613 | -1,635 |
| Amortization of intangible assets | -1,976 | -2,025 | -1,905 | -1,785 | -2,233 |
| Goodwill impairment | -5,725 | -431 | |||
| Restructuring charges | -1,179 | -507 | 0 | ||
| Loss on assets held for sale | -349 | ||||
| Gain on divestiture of subsidiary | 475 | 0 | |||
| Omnicare litigation charge | -5,803 | 0 | |||
| Acquisition purchase price adjustment outside of measurement period | 61 | ||||
| Intersegment Eliminations | 0 | ||||
| Store impairments | -1,358 | ||||
| Total | 4,660 | 8,516 | 13,743 | 7,954 | 13,310 |
| $ Mil | 2014 | 2013 | 2012 | 2011 | 2010 |
|---|---|---|---|---|---|
| Pharmacy Services Segment | 42,302 | 38,343 | 36,057 | 35,704 | 32,254 |
| Retail Pharmacy | 30,979 | 30,191 | 29,183 | 28,323 | 28,927 |
| Corporate | 2,530 | 4,420 | 1,408 | 1,121 | 1,439 |
| Intersegment | -1,559 | ||||
| Eliminations | -1,428 | -736 | -605 | -451 | |
| Total | 74,252 | 71,526 | 65,912 | 64,543 | 62,169 |
Price Behavior
| Market Price | $90.27 | |
| Market Cap ($ Bil) | 115.5 | |
| First Trading Date | 12/17/1984 | |
| Distance from 52W High | -17.9% | |
| 50 Days | 200 Days | |
| DMA Price | $99.10 | $86.34 |
| DMA Trend | up | down |
| Distance from DMA | -8.9% | 4.6% |
| 3M | 1YR | |
| Volatility | 26.4% | 30.9% |
| Downside Capture | 33.42 | 1.29 |
| Upside Capture | -12.35 | 27.79 |
| Correlation (SPY) | -4.9% | 7.0% |
| 1M | 2M | 3M | 6M | 1Y | 3Y | |
|---|---|---|---|---|---|---|
| Beta | 0.15 | 0.05 | -0.06 | 0.20 | 0.16 | 0.31 |
| Up Beta | -0.23 | -0.59 | -0.53 | -0.10 | 0.13 | 0.44 |
| Down Beta | -1.30 | 0.02 | -0.20 | 0.51 | 0.26 | 0.38 |
| Up Capture | -34% | -11% | 24% | 33% | 21% | 7% |
| Bmk +ve Days | 10 | 21 | 32 | 68 | 138 | 427 |
| Stock +ve Days | 9 | 20 | 33 | 64 | 139 | 405 |
| Down Capture | 219% | 89% | 9% | 3% | -6% | 24% |
| Bmk -ve Days | 11 | 21 | 32 | 59 | 113 | 324 |
| Stock -ve Days | 11 | 21 | 30 | 62 | 111 | 343 |
[1] Upside and downside betas calculated using positive and negative benchmark daily returns respectively
Based On 1-Year Data
| Annualized Return | Annualized Volatility | Sharpe Ratio | Correlation with CVS | |
|---|---|---|---|---|
| CVS | 26.9% | 30.8% | 0.79 | - |
| Sector ETF (XLV) | 25.0% | 16.1% | 1.19 | 25.6% |
| Equity (SPY) | 16.6% | 12.9% | 0.92 | 6.4% |
| Gold (GLD) | 17.4% | 29.3% | 0.55 | -1.9% |
| Commodities (DBC) | 45.8% | 20.7% | 1.72 | -7.2% |
| Real Estate (VNQ) | 5.7% | 13.5% | 0.16 | 20.5% |
| Bitcoin (BTCUSD) | -34.9% | 43.9% | -0.85 | 1.7% |
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Based On 5-Year Data
| Annualized Return | Annualized Volatility | Sharpe Ratio | Correlation with CVS | |
|---|---|---|---|---|
| CVS | 4.5% | 30.2% | 0.17 | - |
| Sector ETF (XLV) | 6.3% | 15.2% | 0.23 | 39.7% |
| Equity (SPY) | 12.6% | 17.2% | 0.56 | 24.9% |
| Gold (GLD) | 18.9% | 18.8% | 0.81 | -3.0% |
| Commodities (DBC) | 11.7% | 19.6% | 0.47 | 3.2% |
| Real Estate (VNQ) | 1.0% | 18.8% | -0.05 | 24.0% |
| Bitcoin (BTCUSD) | 10.4% | 52.5% | 0.38 | 9.8% |
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Based On 10-Year Data
| Annualized Return | Annualized Volatility | Sharpe Ratio | Correlation with CVS | |
|---|---|---|---|---|
| CVS | 2.8% | 29.5% | 0.14 | - |
| Sector ETF (XLV) | 10.6% | 16.7% | 0.51 | 50.0% |
| Equity (SPY) | 15.1% | 18.0% | 0.71 | 39.3% |
| Gold (GLD) | 12.0% | 16.4% | 0.60 | -2.5% |
| Commodities (DBC) | 8.5% | 18.1% | 0.39 | 11.0% |
| Real Estate (VNQ) | 4.4% | 20.7% | 0.17 | 33.9% |
| Bitcoin (BTCUSD) | 62.0% | 66.1% | 1.02 | 7.4% |
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Returns Analyses
Earnings Returns History
Updated 9/8/2026| Forward Returns | |||
|---|---|---|---|
| Earnings Date | 1D Returns | 5D Returns | 21D Returns |
| 8/5/2026 | -5.1% | -10.5% | -6.9% |
| 5/6/2026 | 7.6% | 17.9% | 17.5% |
| 2/10/2026 | -0.1% | 3.2% | -0.1% |
| 10/29/2025 | -1.9% | -5.0% | -2.8% |
| 7/31/2025 | -0.3% | 2.0% | 15.8% |
| 5/1/2025 | 4.1% | 0.1% | -4.0% |
| 2/12/2025 | 14.9% | 20.7% | 19.5% |
| 11/6/2024 | 11.3% | -2.4% | 2.7% |
| ... | |||
| SUMMARY STATS | |||
| # Positive | 13 | 15 | 12 |
| # Negative | 11 | 9 | 12 |
| Median Positive | 4.8% | 3.2% | 5.2% |
| Median Negative | -3.2% | -5.0% | -4.7% |
| Max Positive | 14.9% | 20.7% | 19.9% |
| Max Negative | -16.8% | -17.7% | -17.2% |
| Forward Returns | |||
|---|---|---|---|
| Earnings Date | 1D Returns | 5D Returns | 21D Returns |
| 8/5/2026 | -5.1% | -10.5% | -6.9% |
| 5/6/2026 | 7.6% | 17.9% | 17.5% |
| 2/10/2026 | -0.1% | 3.2% | -0.1% |
| 10/29/2025 | -1.9% | -5.0% | -2.8% |
| 7/31/2025 | -0.3% | 2.0% | 15.8% |
| 5/1/2025 | 4.1% | 0.1% | -4.0% |
| 2/12/2025 | 14.9% | 20.7% | 19.5% |
| 11/6/2024 | 11.3% | -2.4% | 2.7% |
| 8/7/2024 | -3.2% | -4.3% | -0.5% |
| 5/1/2024 | -16.8% | -17.7% | -17.2% |
| 2/7/2024 | 3.1% | 3.8% | 0.7% |
| 11/1/2023 | -0.4% | 1.8% | -1.5% |
| 8/2/2023 | 3.3% | 0.1% | -9.6% |
| 5/3/2023 | -3.7% | -3.8% | -5.3% |
| 2/8/2023 | 3.5% | 3.0% | -10.4% |
| 11/2/2022 | 2.3% | 7.4% | 7.4% |
| 8/3/2022 | 6.3% | 8.7% | 2.9% |
| 5/4/2022 | 4.8% | 2.3% | 1.3% |
| 2/9/2022 | -5.4% | -7.1% | -6.1% |
| 11/3/2021 | 5.7% | 1.8% | -1.3% |
| 8/4/2021 | -2.9% | -0.9% | 2.0% |
| 5/4/2021 | 4.4% | 10.5% | 10.7% |
| 2/16/2021 | -5.0% | -5.0% | 1.2% |
| 11/6/2020 | 5.8% | 13.0% | 19.9% |
| SUMMARY STATS | |||
| # Positive | 13 | 15 | 12 |
| # Negative | 11 | 9 | 12 |
| Median Positive | 4.8% | 3.2% | 5.2% |
| Median Negative | -3.2% | -5.0% | -4.7% |
| Max Positive | 14.9% | 20.7% | 19.9% |
| Max Negative | -16.8% | -17.7% | -17.2% |
SEC Filings
Expand for More| Report Date | Filing Date | Filing |
|---|---|---|
| 06/30/2026 | 08/05/2026 | 10-Q |
| 03/31/2026 | 05/06/2026 | 10-Q |
| 12/31/2025 | 02/10/2026 | 10-K |
| 09/30/2025 | 10/29/2025 | 10-Q |
| 06/30/2025 | 07/31/2025 | 10-Q |
| 03/31/2025 | 05/01/2025 | 10-Q |
| 12/31/2024 | 02/12/2025 | 10-K |
| 09/30/2024 | 11/06/2024 | 10-Q |
| 06/30/2024 | 08/07/2024 | 10-Q |
| 03/31/2024 | 05/01/2024 | 10-Q |
| 12/31/2023 | 02/07/2024 | 10-K |
| 09/30/2023 | 11/01/2023 | 10-Q |
| 06/30/2023 | 08/02/2023 | 10-Q |
| 03/31/2023 | 05/03/2023 | 10-Q |
| 12/31/2022 | 02/08/2023 | 10-K |
| 09/30/2022 | 11/02/2022 | 10-Q |
| Report Date | Filing Date | Filing |
|---|---|---|
| 06/30/2026 | 08/05/2026 | 10-Q |
| 03/31/2026 | 05/06/2026 | 10-Q |
| 12/31/2025 | 02/10/2026 | 10-K |
| 09/30/2025 | 10/29/2025 | 10-Q |
| 06/30/2025 | 07/31/2025 | 10-Q |
| 03/31/2025 | 05/01/2025 | 10-Q |
| 12/31/2024 | 02/12/2025 | 10-K |
| 09/30/2024 | 11/06/2024 | 10-Q |
| 06/30/2024 | 08/07/2024 | 10-Q |
| 03/31/2024 | 05/01/2024 | 10-Q |
| 12/31/2023 | 02/07/2024 | 10-K |
| 09/30/2023 | 11/01/2023 | 10-Q |
| 06/30/2023 | 08/02/2023 | 10-Q |
| 03/31/2023 | 05/03/2023 | 10-Q |
| 12/31/2022 | 02/08/2023 | 10-K |
| 09/30/2022 | 11/02/2022 | 10-Q |
| 06/30/2022 | 08/03/2022 | 10-Q |
| 03/31/2022 | 05/04/2022 | 10-Q |
| 12/31/2021 | 02/09/2022 | 10-K |
| 09/30/2021 | 11/03/2021 | 10-Q |
| 06/30/2021 | 08/04/2021 | 10-Q |
| 03/31/2021 | 05/04/2021 | 10-Q |
| 12/31/2020 | 02/16/2021 | 10-K |
| 09/30/2020 | 11/06/2020 | 10-Q |
| 06/30/2020 | 08/05/2020 | 10-Q |
| 03/31/2020 | 05/06/2020 | 10-Q |
| 12/31/2019 | 02/18/2020 | 10-K |
| 09/30/2019 | 11/06/2019 | 10-Q |
Recent Forward Guidance
Updated 8/6/2026Latest: Q2 2026 Earnings Reported 8/5/2026
| Forward Guidance | Guidance Change | |||||||
|---|---|---|---|---|---|---|---|---|
| Metric | Source | Low | Mid | High | % Chg | % Delta | Change | Prior |
| 2026 Cash Flow from Operations | Reported | 11.50 Bil | 21.1% | Raised | Guidance: 9.50 Bil for 2026 | |||
| 2026 Revenue | Reported | 414.00 Bil | 2.2% | Raised | Guidance: 405.00 Bil for 2026 | |||
| 2026 GAAP Diluted EPS | Reported | 6.84 | 6.94 | 7.04 | 9.5% | Raised | Guidance: 6.34 for 2026 | |
| 2026 Adjusted EPS | Reported | 7.9 | 8 | 8.1 | 8.1% | Raised | Guidance: 7.4 for 2026 | |
Prior: Q1 2026 Earnings Reported 5/6/2026
| Forward Guidance | Guidance Change | |||||||
|---|---|---|---|---|---|---|---|---|
| Metric | Source | Low | Mid | High | % Chg | % Delta | Change | Prior |
| 2026 Cash flow from operations | Reported | 9.50 Bil | 5.6% | Raised | Guidance: 9.00 Bil for 2026 | |||
| 2026 Total revenues | Reported | 405.00 Bil | ||||||
| 2026 Diluted earnings per share | Reported | 6.24 | 6.34 | 6.44 | 5.0% | Raised | Guidance: 6.04 for 2026 | |
| 2026 Adjusted EPS | Reported | 7.3 | 7.4 | 7.5 | 4.2% | Raised | Guidance: 7.1 for 2026 | |
Q4 2025 Earnings Reported 2/10/2026
| Forward Guidance | Guidance Change | |||||||
|---|---|---|---|---|---|---|---|---|
| Metric | Source | Low | Mid | High | % Chg | % Delta | Change | Prior |
| 2026 Cash Flow from Operations | Reported | 9.00 Bil | -10.0% | Lowered | Guidance: 10.00 Bil for 2025 | |||
| 2026 GAAP Diluted EPS | Reported | 5.94 | 6.04 | 6.14 | Affirmed | Actual: -0.29 for 2025 | ||
| 2026 Adjusted EPS | Reported | 7 | 7.1 | 7.2 | Affirmed | Actual: 6.6 for 2025 | ||
Q3 2025 Earnings Reported 10/29/2025
| Forward Guidance | Guidance Change | |||||||
|---|---|---|---|---|---|---|---|---|
| Metric | Source | Low | Mid | High | % Chg | % Delta | Change | Prior |
| 2025 GAAP Diluted Earnings (Loss) Per Share | Reported | -0.34 | -0.29 | -0.24 | -107.5% | Lowered | Guidance: 3.89 for 2025 | |
| 2025 Cash Flow from Operations | Reported | 7.50 Bil | 7.75 Bil | 8.00 Bil | 3.3% | Raised | Guidance: 7.50 Bil for 2025 | |
| 2025 Adjusted EPS | Reported | 6.55 | 6.6 | 6.65 | 3.9% | Raised | Guidance: 6.35 for 2025 | |
Insider Activity
Updated 6/29/2026| # | Owner | Title | Holding | Action | Filing Date | Price | Shares | Transacted Value | Value of Held Shares | Form |
|---|---|---|---|---|---|---|---|---|---|---|
| 1 | Robbins, Larry | Held by Glenview Investment Funds | Sell | 5212026 | 93.45 | 370,462 | 34,619,007 | 450,868,782 | Form | |
| 2 | Robbins, Larry | Held by Glenview Investment Funds | Sell | 5212026 | 93.82 | 1,018,000 | 95,510,822 | 487,429,908 | Form | |
| 3 | Robbins, Larry | Held by Glenview Investment Funds | Sell | 5212026 | 94.45 | 1,983,538 | 187,341,308 | 586,830,421 | Form | |
| 4 | Mandadi, Tilak | EVP, Chief Exp & Tech Officer | Direct | Sell | 5112026 | 89.58 | 69,551 | 6,230,379 | 907,714 | Form |
| 5 | Nelson, Steven H | EVP and President, Aetna | Trust | Buy | 1262026 | 53.70 | 24 | 1,289 | 1,289 | Form |
| # | Owner | Title | Holding | Action | Filing Date | Price | Shares | Transacted Value | Value of Held Shares | Form |
|---|---|---|---|---|---|---|---|---|---|---|
| 1 | Robbins, Larry | Held by Glenview Investment Funds | Sell | 5212026 | 93.45 | 370,462 | 34,619,007 | 450,868,782 | Form | |
| 2 | Robbins, Larry | Held by Glenview Investment Funds | Sell | 5212026 | 93.82 | 1,018,000 | 95,510,822 | 487,429,908 | Form | |
| 3 | Robbins, Larry | Held by Glenview Investment Funds | Sell | 5212026 | 94.45 | 1,983,538 | 187,341,308 | 586,830,421 | Form | |
| 4 | Mandadi, Tilak | EVP, Chief Exp & Tech Officer | Direct | Sell | 5112026 | 89.58 | 69,551 | 6,230,379 | 907,714 | Form |
| 5 | Nelson, Steven H | EVP and President, Aetna | Trust | Buy | 1262026 | 53.70 | 24 | 1,289 | 1,289 | Form |
| 6 | Capozzi, Heidi B | EVP and Chief People Officer | Trust | Buy | 10142025 | 56.85 | 35 | 1,990 | 4,832 | Form |
| 7 | Capozzi, Heidi B | EVP and Chief People Officer | Trust | Buy | 10142025 | 62.24 | 10 | 622 | 3,112 | Form |
| 8 | Capozzi, Heidi B | EVP and Chief People Officer | Trust | Buy | 10142025 | 56.47 | 35 | 1,976 | 2,259 | Form |
| 9 | Finucane, Anne A | Trust | Sell | 8292025 | 71.02 | 7,500 | 532,650 | 1,573,519 | Form | |
| 10 | Sansone, Guy P | Direct | Buy | 6092025 | 63.70 | 1,570 | 100,009 | 764,869 | Form |
Investor Activity (13F)
Updated Sep 18, 2026Active managers (13F portfolio over $250M, at least 3 holdings) with a position over $5M that is either over 10% of their portfolio or held in a concentrated book of 50 or fewer total positions. Index/ETF, sovereign, bank, community-bank and charitable/donor-advised filers are excluded.
| Active Manager | Value | % of Portfolio | Total Positions | QoQ | Filing |
|---|---|---|---|---|---|
| Glenview Capital Management, LLC | $588.7 Mil | 15.9% | 41 | Hold | 13F |
| Fairfax Financial Holdings LTD/ Can | $194.8 Mil | 10.0% | 29 | Hold | 13F |
| Solel Partners LP | $35.5 Mil | 7.6% | 19 | TRIM -16.8% | 13F |
| Kiltearn Partners LLP | $26.2 Mil | 7.1% | 25 | TRIM -17.4% | 13F |
| Colrain Capital LLC | $10.7 Mil | 4.1% | 26 | ADD +21.6% | 13F |
| Patient Capital Management, LLC | $97.5 Mil | 3.6% | 38 | ADD +10.2% | 13F |
| Permit Capital, LLC | $9.0 Mil | 3.1% | 19 | Hold | 13F |
| Atle Fund Management AB | $9.3 Mil | 3.0% | 39 | TRIM -77.7% | 13F |
| Hamlin Capital Management, LLC | $118.0 Mil | 2.8% | 30 | TRIM -19.0% | 13F |
| Maple Rock Capital Partners Inc. | $75.3 Mil | 2.4% | 44 | ADD +28.4% | 13F |
| Sector Gamma AS | $9.7 Mil | 2.3% | 42 | TRIM -23.8% | 13F |
| SRB Corp | $36.3 Mil | 2.2% | 44 | Hold | 13F |
| MFF Capital Investments Ltd | $25.9 Mil | 1.7% | 19 | ADD +17.2% | 13F |
| Legacy CG, LLC | $5.7 Mil | 1.6% | 45 | Hold | 13F |
| Park West Asset Management LLC | $12.7 Mil | 1.1% | 48 | ADD +20.1% | 13F |
| Active Manager | Value | % of Portfolio | Total Positions | QoQ | Filing |
|---|---|---|---|---|---|
| Maple Rock Capital Partners Inc. | $75.3 Mil | 2.4% | 44 | ADD +28.4% | 13F |
| Colrain Capital LLC | $10.7 Mil | 4.1% | 26 | ADD +21.6% | 13F |
| Park West Asset Management LLC | $12.7 Mil | 1.1% | 48 | ADD +20.1% | 13F |
| MFF Capital Investments Ltd | $25.9 Mil | 1.7% | 19 | ADD +17.2% | 13F |
| Patient Capital Management, LLC | $97.5 Mil | 3.6% | 38 | ADD +10.2% | 13F |
| Active Manager | Value | % of Portfolio | Total Positions | QoQ | As Of | Filing |
|---|---|---|---|---|---|---|
| Sachem Head Capital Management LP | $205.1 Mil | 4.8% | 20 | Exited | Dec 31, 2025 | 13F |
| SRS Investment Management, LLC | $48.6 Mil | 0.5% | 31 | Exited | Dec 31, 2025 | 13F |
| 8 Knots Management, LLC | $40.9 Mil | 4.7% | 12 | Exited | Dec 31, 2025 | 13F |
| Iron Triangle Partners LP | $34.3 Mil | 3.9% | 27 | Exited | Dec 31, 2025 | 13F |
| Benson Investment Management Company, Inc. | $5.9 Mil | 2.1% | 50 | Exited | Dec 31, 2025 | 13F |
| Atle Fund Management AB | $9.3 Mil | 3.0% | 39 | TRIM -77.7% | Mar 31, 2026 | 13F |
| Sector Gamma AS | $9.7 Mil | 2.3% | 42 | TRIM -23.8% | Mar 31, 2026 | 13F |
| Hamlin Capital Management, LLC | $118.0 Mil | 2.8% | 30 | TRIM -19.0% | Mar 31, 2026 | 13F |
| Kiltearn Partners LLP | $26.2 Mil | 7.1% | 25 | TRIM -17.4% | Mar 31, 2026 | 13F |
| Solel Partners LP | $35.5 Mil | 7.6% | 19 | TRIM -16.8% | Mar 31, 2026 | 13F |
| Active Manager | Value | % of Portfolio | Total Positions | QoQ | Filing |
|---|---|---|---|---|---|
| Glenview Capital Management, LLC | $588.7 Mil | 15.9% | 41 | Hold | 13F |
| Fairfax Financial Holdings LTD/ Can | $194.8 Mil | 10.0% | 29 | Hold | 13F |
| Hamlin Capital Management, LLC | $118.0 Mil | 2.8% | 30 | TRIM -19.0% | 13F |
| Patient Capital Management, LLC | $97.5 Mil | 3.6% | 38 | ADD +10.2% | 13F |
| Maple Rock Capital Partners Inc. | $75.3 Mil | 2.4% | 44 | ADD +28.4% | 13F |
| SRB Corp | $36.3 Mil | 2.2% | 44 | Hold | 13F |
| Solel Partners LP | $35.5 Mil | 7.6% | 19 | TRIM -16.8% | 13F |
| Kiltearn Partners LLP | $26.2 Mil | 7.1% | 25 | TRIM -17.4% | 13F |
| MFF Capital Investments Ltd | $25.9 Mil | 1.7% | 19 | ADD +17.2% | 13F |
| Park West Asset Management LLC | $12.7 Mil | 1.1% | 48 | ADD +20.1% | 13F |
| Colrain Capital LLC | $10.7 Mil | 4.1% | 26 | ADD +21.6% | 13F |
| Sector Gamma AS | $9.7 Mil | 2.3% | 42 | TRIM -23.8% | 13F |
| Atle Fund Management AB | $9.3 Mil | 3.0% | 39 | TRIM -77.7% | 13F |
| Permit Capital, LLC | $9.0 Mil | 3.1% | 19 | Hold | 13F |
| Legacy CG, LLC | $5.7 Mil | 1.6% | 45 | Hold | 13F |
CVS Trade Sentinel
Constructive
CONVICTION RATIONALE
Strong 2026 execution, shown by an 8.1% increase in adjusted EPS guidance and improving insurance margins, is overshadowed by flagged 2027 headwinds in the pharmacy benefits business. The case hinges on management navigating this transition, which their strong 'say-do' record supports, creating a constructive setup for investors who can tolerate near-term uncertainty.
STOCK ARCHETYPE
Diversified Conglomerate(Medical Members x Premiums/Fees) + (Pharmacy Claims x Fees/Spreads) + (Retail Volume x Price) Margin management within the Health Care Benefits segment and leveraging scale for purchasing economics in the Health Services (PBM) and Pharmacy & Consumer Wellness segments.
INVESTMENT THESIS
Evidence suggests operational momentum in the insurance business is strong enough to navigate a strategic repositioning of the PBM.
- Full-year 2026 adjusted EPS guidance was raised to a range of $7.90 to $8.10.
- The Medical Benefit Ratio improved to 87.4% in Q2 2026 from 89.9% a year prior.
- Same-store prescription volume grew an accelerating 7.0% in the latest quarter.
- Cash flow from operations guidance for 2026 was increased to at least $11.5 billion.
- Net debt declined to $62.3 billion from $68.6 billion a year ago.
PRIMARY RISK
A strategic shift to transparent pricing, coupled with regulatory scrutiny, could lead to sustained PBM membership and margin erosion beyond 2027, impairing the company's largest segment.
- Management expects 'membership declines in Caremark next year' (2027).
- The Health Services segment has a lower operating margin (3.1%) than other segments.
- The company faces a new RICO complaint filed against its Caremark PBM in March 2026.
- The 340B drug pricing program is expected to be a 'headwind in 2027'.
- Operating margin of 3.4% trails key integrated peer UnitedHealth at 4.8%.
| KPI | Status | Rationale |
|---|---|---|
| Medical Benefit Ratio (MBR) | 87.4% for the quarter ended June 30, 2026 - Turning around | The year-over-year improvement in the Medical Benefit Ratio (lower is better) is significant, reflecting progress in the company's margin recovery plan for its Aetna business. Management attributed the strength to improved performance in the Government business, strong medical cost management, and the absence of a prior-year premium deficiency reserve. The sequential increase from Q1 is an expected seasonal pattern. |
| Pharmacy & Consumer Wellness Same-Store Prescription Volume Growth | 7.0% for the quarter ended June 30, 2026 - Accelerating | Growth in same-store prescription volume is strong and accelerating on a year-over-year basis, indicating robust organic performance and market share gains in the core retail pharmacy business. Management noted this reflects building momentum and growing volumes, positioning the segment as the "best-run national pharmacy." |
| Medical Membership | 26.0 million (as of June 30, 2026) | Indicates the scale and reach of the Health Care Benefits (insurance) segment. |
| Pharmacy Claims Processed (30-day equivalent) | 473.0 million (Q2 2026) | Measures the volume of prescription claims managed by the Health Services (PBM) segment, reflecting its market share and operational scale. |
| Prescriptions Filled (30-day equivalent) | 457.0 million (Q2 2026) | Measures prescription volume dispensed through the Pharmacy & Consumer Wellness segment, indicating retail traffic and market share. |
Aetna's momentum vs. Caremark's 2027 headwinds
BULL VIEW
Bulls focus on the 8.1% raise in 2026 adjusted EPS guidance, driven by strong execution in the Aetna insurance unit, as proof that management can deliver financially while proactively managing a PBM model transition.
CORE TENSION
Can the Aetna margin recovery, with its MBR improving to 87.4%, offset the flagged 2027 Caremark membership declines, which caused the market's negative reaction to strong results?
PREVAILING SENTIMENT
Current evidence favors the bulls' execution story, as 2026 results and guidance are concrete. However, the market is pricing in the bear case until the 2027 impact is quantified.
BEAR VIEW
Bears see the -8.0% stock drop after the guidance raise as a sign that flagged 2027 PBM membership declines are the start of a structural margin problem that current Aetna strength cannot overcome.
| Timeline | Event & Metric To Watch |
|---|---|
in 2026 | Medicare Drug Prices Effective Watch: Prices for the first ten drugs in the Medicare Drug Negotiation Program take effect. |
Q3 2026 earnings call (early Nov 2026) | PBM Headwind Quantification Watch: Specifics on the magnitude of 2027 Caremark membership losses and the financial impact of 340B pressures. |
10/9/2026 | Peer Medical Cost Read-Through Watch: UNH commentary on medical cost trends, particularly in Medicare Advantage, and any deviation from current expectations. |
10/19/2026 | Elevance Health Earnings Watch: Peer Elevance Health (ELV) is scheduled to report earnings. |
11/6/2026 | Humana Earnings Report Watch: Peer Humana (HUM) is scheduled to report earnings. |
on our third quarter call | Initial 2027 Outlook Watch: Management will provide commentary on 2027 headwinds and tailwinds. |
on our fourth quarter call | Formal 2027 Guidance Watch: Company will provide detailed full year guidance for 2027. |
later this year | Health100 Platform Launch Watch: Launch of Health100 platform and a recently discussed product AI-powered assistant. |
by the end of this year | Prior Authorization Standardization Watch: Company committed to standardizing prior authorization submissions for the most common procedures. |
No set date | FTC Settlement Finality Watch: An official announcement from the FTC on whether it will approve the settlement and issue a final order. |
| Date | Event | Stock Impact |
|---|---|---|
2026-09-15 | Proposed FTC Settlement Details: The company and the FTC announced a proposed settlement to resolve outstanding investigations into its PBM and affiliated pharmacy businesses. The agreement is subject to a public comment period. | -1.1% $95.55 -> $94.49 |
2026-09-03 | Seasonal Vaccines Available Details: Updated COVID-19 and 2026-2027 flu vaccines became available at CVS Pharmacy and MinuteClinic locations nationwide. | -0.5% $97.23 -> $96.74 |
2026-08-05 | Q2 Earnings and Guidance Raise Details: The company reported Q2 results, raising full-year 2026 adjusted EPS guidance by 8.1% to a new midpoint of $8. The stock reacted negatively, falling -8.0%. | -7.9% $104.42 -> $96.22 |
2026-05-13 | Omnicare Business Sale Approved Details: A U.S. Bankruptcy Court approved the sale of the company's Omnicare business to GenieRx. | +2.1% $94.56 -> $96.55 |
2026-05-07 | Q1 Earnings Beat Details: The company reported Q1 2026 results, leading to a positive two-day stock reaction of 4.0% versus 1.0% for the S&P 500. | +4.2% $86.33 -> $89.99 |
2026-03-19 | RICO Lawsuit Filed Details: A class action was filed against CaremarkPCS and CVS Health alleging violations of the Racketeer Influenced and Corrupt Organizations (RICO) Act. | -2.1% $71.94 -> $70.42 |
Position Sizing
4% - 6%
NORMAL POSITION
Sizing is volatility-based: CVS trades at roughly 30% annualized options-implied volatility versus about 13% for the S&P 500 (2.2x the market), around the 65th percentile of its own trailing year. A 4% - 6% position keeps a single-name swing of that size within a diversified portfolio's risk budget.
Diversification Alternatives
UNH - UnitedHealth
Integrated PeerUnitedHealth demonstrates superior profitability, with a trailing-twelve-month operating margin of 4.8% versus 3.4% for CVS, and does not have a large retail footprint.
WMT - Walmart
Retail CompetitorWalmart offers exposure to the price-sensitive pharmacy consumer through a dominant, low-cost retail model, competing with CVS's Pharmacy & Consumer Wellness segment but without the insurance and PBM complexities.
A vertically integrated health care utility using its scale across insurance, PBM, and retail to manage costs and capture value at every point in the health care journey.
CVS Health operates as a three-part health care conglomerate: a massive insurer (Aetna), a dominant drug price negotiator (Caremark), and a ubiquitous retail and clinical footprint. The core strategy is to leverage the integration of these assets to control the total cost of care, directing members to its own services and managing their drug spend. The current investment thesis hinges on the successful margin recovery in the Aetna insurance business and the company's ability to navigate a major industry shift towards more transparent pricing in its PBM and retail pharmacy segments.
Sustained margin improvement in the Health Care Benefits segment, stable or growing PBM client retention during the transition to new pricing models, and successful integration and growth of value-based care assets like Oak Street Health.
Failure to achieve target margins in the Aetna business, significant PBM client losses, or adverse federal legislation that fundamentally undermines the PBM business model or the benefits of vertical integration.
Minor fluctuations in front-store retail sales, routine litigation not targeting core business practices, and seasonal variations in flu and vaccine demand.
Repricing Catalyst
Strong execution and delivery on financial commitments, particularly the significant year-over-year improvement in the Health Care Benefits segment's profitability, which led to a substantial increase in full-year 2026 guidance.
Health Care Benefits
$145.8B TTM (35% of Total)What It Is
Offers a broad range of traditional, voluntary, and consumer-directed health insurance products and related services, including medical, pharmacy, dental, and behavioral health plans. Customers include employer groups, government-sponsored plans (Medicare, Medicaid), and individuals.
Who Pays & How
Employers, government agencies (e.g., CMS), and individuals pay premiums for access to a network of providers and management of health care costs. The company serves an estimated 37 million people through these products.
Competition
Health Services
$200.5B TTM (48% of Total)What It Is
Provides a full range of Pharmacy Benefit Management (PBM) solutions, including plan design, formulary management, and specialty pharmacy. It also delivers health care services through medical clinics (Oak Street Health), in-home evaluations (Signify Health), and virtually. Clients are primarily employers, insurance companies, unions, and government employee groups.
Who Pays & How
Employers and health plans pay fees to have the company manage their prescription drug benefits, leveraging its scale to negotiate favorable drug prices and rebates from manufacturers, thereby controlling overall health care spending.
Competition
Pharmacy & Consumer Wellness
$139.7B TTM (34% of Total)What It Is
Dispenses prescriptions and sells a wide assortment of health and wellness products, personal care items, and general merchandise through approximately 9,000 retail locations and online. Customers include individual consumers and members of third-party payor plans.
Who Pays & How
Third-party payors (PBMs, managed care organizations, government programs) reimburse the company for the majority of pharmacy revenues. Individual consumers pay directly for front-store merchandise and prescription co-pays.
Competition
Corporate/Other
$528M TTM (0% of Total)What It Is
This segment consists of management and administrative expenses to support overall operations and legacy products for which the company no longer solicits new customers, such as large case pensions and long-term care insurance.
Who Pays & How
This segment primarily incurs costs rather than generating significant external revenue.
Competition
CVS Health — Investor Video Playlist
Industry Resources
| Health Care Resources |
| U.S. National Library of Medicine |
| ClinicalTrials.gov |
| Modern Healthcare |
| Healthcare Dive |
| Fierce Healthcare |
| Health Affairs |
| Health Data Management |
| FDA Tracker |
| Health Care Services Resources |
| HealthLeaders Media |
| Medical Economics |
| Physicians Practice |
External Quote Links
| Y Finance | Barrons |
| TradingView | Morningstar |
| SeekingAlpha | ValueLine |
| Motley Fool | Robinhood |
| CNBC | Etrade |
| MarketWatch | Unusual Whales |
| YCharts | Perplexity Finance |
| FinViz |
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