In a report released today, Allen Lutz from Bank of America Securities maintained a Buy rating on CVS Health, with a price target of $89.00.
Elevate Your Investing Strategy:
- Take advantage of TipRanks Premium at 50% off! Unlock powerful investing tools, advanced data, and expert analyst insights to help you invest with confidence.
Allen Lutz has given his Buy rating due to a combination of factors that suggest potential for CVS Health’s stock to outperform. One of the key reasons is the company’s strategic focus on improving its Medicare Advantage margins, with supplemental benefits identified as a significant driver of enhanced Health Care Benefits margins in the coming years. CVS is also actively repricing its Group Medicare Advantage business, which is expected to contribute positively to earnings.
Another factor supporting the Buy rating is the anticipated ramp-up in Health Services earnings in the second half of the year, driven by client guarantees. Despite some challenges in the first half, CVS has adjusted its guidance to reflect these pressures and expects a balanced performance in the latter half. Additionally, while there are uncertainties regarding vaccination demand, CVS has accounted for potential market fluctuations in its guidance, maintaining a prudent outlook. These strategic initiatives and adjustments underpin the confidence in CVS’s ability to achieve its price objective.
In another report released on September 3, Leerink Partners also reiterated a Buy rating on the stock with a $86.00 price target.