The CVS Series Raises Expectations For 2021

CVS Health raises expectations for 2021 and says health insurance coverage for Covid home tests may boost sales

CVS Health raised its full-year earnings guidance and reaffirmed its earlier 2022 aspirations as the company attracts customers to its pharmacies with COVID testing and vaccines and seeks opportunities to provide other types of health services, including health care and insurance. Read more [CVS Closes Some Pharmacies to Enhance Health Services].

The company expects that profits in 2021 will range between $5.87-5.92 per share, after its previous expectations ranged between $5.50-5.61 per share, and after adjustment, it sees earnings of $8.33-8.38 per share instead of the previous forecast of at least $8 per share, and the new field of interest is higher than the average Wall Street analyst forecast of $8.03 per share.

CVS says 80% of its outperformance is attributable to the retail business, with Covid vaccines accounting for more than half of the division’s sales, and the surge in infections caused by the Omicron mutant so far appears to result in less need for medical care and hospitalizations, which means it brings in lower costs to Aetna’s health insurance business than it does to the delta variant. Read more [CVS Health Posts Strong Results Supported By Prescription] and [CVS Health profits beat expectations after higher sales of virus vaccines and tests].

CVS reiterated its 2022 forecast, which represents earnings per share ranging between $7.04-7.24 and a range of $8.10-8.30 after adjustment. As for analysts, they believe earnings per share after adjustment will be $8.27 through 2022.

The company’s stock rose 1% in early trading and touched a 52-week high at $107.26.

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