CVS Health price target lowered to $95 from $100 at BofA

BofA lowered the firm’s price target on CVS Health (CVS) to $95 from $100 and keeps a Buy rating on the shares after the Centers for Medicare & Medicaid Services announced the proposed policies in the calendar year 2027 Advance Notice are projected to result in a net all-in rate of 2.54%, below the market’s general expectation for an increase of 4%-6%. The announcement is a headwind to the Medicare Advantage margin expansion story, says the analyst, who estimates the gross unmitigated headwind to CVS would be more than $1B of Medicare Advantage revenue and margin if the final rates match these advanced rates and CVS makes no offsetting changes to benefits. However, the firm also notes that in the past 14 years, the final rate has come in better than the proposal 64% of the time.