CVS Health (CVS) earnings Q2 2021 beat estimates

A view outdoors a CVS Pharmacy retailer on July 16, 2020 in Miramar, Florida.

Johnny Louis | Getty Pictures

CVS Health on Wednesday outpaced analysts’ expectations for fiscal second-quarter earnings and raised its forecast for the 12 months, as prospects returned to medical doctors workplaces and extra typical purchasing patterns.

But shares of the corporate closed Wednesday down 2.92% to $81.55 as CVS mentioned it anticipated a lower-than-expected variety of Covid-19 vaccines and higher-than-expected Covid-related health-care prices this 12 months. It additionally warned of rising bills forward, together with an increase in employee wages and investments in expertise.

The pharmacy chain and well being insurer mentioned its enterprise has begun to normalize, as prospects purchase extra gadgets within the entrance of the shop and pharmacists fill extra prescriptions. It mentioned use of health-care advantages has returned to a extra typical sample, too, as folks resume medical visits and procedures.

Similar-store gross sales rose 12.3% within the second quarter from a 12 months earlier.

Nonetheless, amid rising Covid-19 cases and the spread of the delta variant, CEO Karen Lynch mentioned CVS stays dedicated to increasing vaccine entry and outreach.

The corporate mentioned it administered practically 17 million Covid vaccines and greater than 6 million exams within the second quarter.

Ashtyn Evans, an analyst for Edward Jones, mentioned CVS faces dangers because it combines its retail, pharmacy and medical health insurance companies and tries to grow to be a “one-stop store” for well being care. She mentioned that imaginative and prescient will take time. Plus, she mentioned, it should overcome worth stress in its pharmacy providers enterprise. The fairness analysis agency has a maintain score for CVS shares.

This is what the corporate reported for the three-month interval ended June 30, in contrast with what analysts have been anticipating, primarily based on a survey of analysts by Refinitiv:

  • Earnings per share: $2.42 adjusted vs. $2.06 anticipated
  • Income: $72.62 billion vs. $70.3 billion anticipated

CVS reported second-quarter web revenue of $2.78 billion, or $2.10 per share, down from $2.98 billion, or $2.26 per share, a 12 months earlier.

Excluding gadgets, it earned $2.42 per share, greater than the $2.06 per share anticipated by analysts surveyed by Refinitiv.

Income jumped to $72.62 billion from $65.34 billion a 12 months earlier, topping expectations of $70.3 billion.

CVS raised its steerage for the 12 months, saying it expects 2021 earnings per share will vary from $6.35 to $6.45, and after changes from $7.70 to $7.80.

As of Tuesday’s shut, shares of CVS have been up about 23% this 12 months. Shares closed on Tuesday at $84, bringing the corporate’s market worth to $110.59 billion.

Read the full press release here.

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