CVS Health (CVS) AI Stock Analysis

• Market Cap: $78.56B
• Dividend Yield: 4.26%
• Average Volume (3M): 8.24M
• Price to Earnings (P/E): 17.3
• Beta (1Y): 0.53
• Revenue Growth: 6.27%
• EPS Growth: -36.28%
• Country: US
• Employees: 219,000
• Sector: Healthcare
• Sector Strength: 38
• Industry: Medical - Healthcare Plans
• EPS (TTM): 1.81
• Shares Outstanding: 1,265,019,400
• 10 Day Avg. Volume: 11,383,051
• 30 Day Avg. Volume: 8,236,077
• PEG Ratio: -1.22
• Price to Book (P/B): 1.02
• Price to Sales (P/S): 0.00
• P/FCF Ratio: 16.53
• Enterprise Value/Market Cap: 1.91
• Enterprise Value/Revenue: 0.10
• Enterprise Value/Gross Profit: 2.81
• Enterprise Value/Ebitda: 2.69
• 1Y Price Target: $80.86
• Price Target Upside: 29.44% Upside
• Rating Consensus: Strong Buy
• Number of Analyst Covering: 16

• Rating: 75 Outperform
• Price Target: $70.00 ▲(12.05%Upside)

CVS Health's strong financial performance and increased earnings guidance are significant positives, supported by solid valuation metrics, including a high dividend yield. Technical indicators suggest a cautious outlook with weak momentum. Challenges in specific business areas and legislative impacts are risks that offset some of the positive sentiment from earnings.

Positive Factors

Aetna Margins

Aetna's margins continue to improve, signaling a potential for sustained positive earnings revisions.

Contract Wins

CVS Caremark wins a contract from OptumRx, enhancing its position in providing outpatient prescription drug benefits to a large member base.

Health Services Growth

The CalPERS contract win and increased biosimilar adoption bolster confidence in CVS's target of 7% long-term EBIT growth in the Health Services segment.

Pharmacy & Consumer Wellness

CVS's strong performance in the Pharmacy & Consumer Wellness segment is a sustainable advantage that sets it apart from competitors.

Negative Factors

Managed Care Risks

Managed Care is recognized as a challenging sector with persistent risks, indicating potential headwinds for CVS.

Performance Guarantees

The five-year contract includes CVS putting approximately $250 million at risk, highlighting the pressures of maintaining performance guarantees.

CVS Health Business Overview & Revenue Model

Company Description

CVS Health Corporation is a leading American healthcare company that operates across multiple sectors, including retail, pharmacy, and health services. The company is headquartered in Woonsocket, Rhode Island, and is one of the largest pharmacy chains in the United States. CVS Health provides a wide array of services and products such as prescription medications, over-the-counter drugs, health and wellness products, and a range of healthcare services through its retail locations, online platforms, and its subsidiary Aetna, a health insurance provider.

How the Company Makes Money

CVS Health generates revenue through several key streams. The primary source of income is its retail and pharmacy operations, where it sells prescription medications as well as a wide range of health and beauty products, general merchandise, and convenience items. Another significant revenue stream comes from its pharmacy benefit management (PBM) services, which include managing drug benefit programs for insurance companies and other clients. Additionally, CVS Health benefits from its health insurance segment, Aetna, which provides health insurance plans and services to individuals and businesses. The company's MinuteClinic locations offer various health services, further diversifying its revenue. Strategic partnerships with healthcare providers and insurers, as well as initiatives in digital health and telemedicine, also contribute to its earnings.

CVS Health Financial Statement Overview

Summary

CVS Health demonstrates solid revenue growth and effective cash management, though profitability margins and return on equity could be improved. The balance sheet is stable, with moderate leverage, supporting long-term financial health. Overall, CVS Health is positioned well in the healthcare sector but should focus on enhancing profitability metrics.

Income Statement

CVS Health has shown consistent revenue growth over recent periods, with a TTM revenue increase of 3.71% compared to the previous year. The company's gross profit margin remains steady at around 13.8% and the EBIT margin improved slightly to 2.3%. However, net profit margins are relatively low at 1.2%, indicating room for profitability enhancement.

Balance Sheet

The balance sheet reflects a stable equity base with a debt-to-equity ratio of approximately 1.07, suggesting moderate leverage. The equity ratio stands at 29.9%, pointing to a solid capital structure. Return on equity is modest at 5.9%, indicating potential for improved shareholder returns.

Cash Flow

Cash flows are robust, with a TTM operating cash flow to net income ratio of 1.67, showing strong cash generation relative to earnings. Free cash flow has decreased, but the free cash flow to net income ratio is healthy at 1.05, suggesting efficient cash utilization despite recent declines.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	386.64B	372.81B	357.78B	322.47B	292.11B	268.71B
Gross Profit	53.45B	51.40B	54.43B	54.50B	52.12B	49.05B
EBITDA	13.01B	13.68B	18.20B	12.35B	17.53B	17.12B
Net Income	4.53B	4.61B	8.34B	4.31B	8.00B	7.18B
Balance Sheet
Total Assets	258.34B	253.22B	249.73B	228.28B	233.00B	230.72B
Cash, Cash Equivalents and Short-Term Investments	14.22B	10.99B	11.46B	15.72B	12.53B	10.85B
Total Debt	82.72B	82.92B	79.39B	70.73B	76.00B	85.04B
Total Liabilities	180.79B	177.49B	173.09B	156.51B	157.62B	161.01B
Stockholders Equity	77.38B	75.56B	76.46B	71.47B	75.08B	69.39B
Cash Flow
Free Cash Flow	4.78B	6.33B	10.39B	13.45B	15.74B	13.43B
Operating Cash Flow	7.57B	9.11B	13.43B	16.18B	18.27B	15.87B
Investing Cash Flow	-5.68B	-7.61B	-20.89B	-5.05B	-5.26B	-5.53B
Financing Cash Flow	-2.68B	-1.14B	2.68B	-10.52B	-11.36B	-7.70B

CVS Health Technical Analysis

• Technical Analysis Sentiment: Neutral
• Last Price: 62.47
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Positive
• MACD: Negative
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For CVS, the sentiment is Neutral. The current price of 62.47 is below the 20-day moving average (MA) of 62.55, below the 50-day MA of 63.74, and above the 200-day MA of 59.39, indicating a neutral trend. The MACD of -0.97 indicates Negative momentum. The RSI at 48.60 is Neutral, neither overbought nor oversold. The STOCH value of 55.61 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for CVS.

CVS Health Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
HUM	79 Outperform	$29.74B	18.98	9.03%	1.43%	9.88%	-7.25%
CVS	75 Outperform	$78.56B	17.33	5.95%	4.26%	6.27%	-36.28%
ELV	71 Outperform	$63.74B	12.05	12.48%	2.43%	10.21%	-17.79%
UNH	68 Neutral	$215.69B	10.30	24.33%	3.58%	9.98%	―
CI	63 Neutral	$70.00B	14.32	12.31%	2.22%	20.93%	43.98%
CNC	58 Neutral	$12.73B	6.41	7.50%	―	12.96%	-23.25%
Sector *	51 Neutral	$7.35B	0.50	-65.61%	2.47%	15.28%	1.44%

CVS Health Corporate Events

CVS Health Elects Board at Annual Meeting

At the CVS Health Corporation Annual Meeting of Stockholders held on May 15, 2025, all 13 nominees for the Board of Directors were elected for a one-year term. The stockholders approved the ratification of Ernst & Young LLP as the independent registered public accounting firm for 2025 and the advisory approval of executive compensation. However, a stockholder proposal to reduce the threshold for stockholder rights to act by written consent was not approved.

The most recent analyst rating on (CVS) stock is a Buy with a $72.00 price target. To see the full list of analyst forecasts on CVS Health stock, see the CVS Stock Forecast page.