CVS Health earnings beat expectations, but shares drop

CVS Health on Wednesday beat expectations for fiscal third-quarter earnings as the company got a boost from filling more prescriptions and giving more Covid-19 vaccines.

The company raised its forecast for the year, saying it expects adjusted earnings per share of $7.90 to $8.00, from $7.70 to $7.80. Before adjustments, however, that guidance was revised downward to between $6.13 to $6.23 from $6.35 to $6.45 previously.

Shares of the company fell about 1% in premarket trading.

Here’s what the company reported for the three-month period ended Sept. 30, compared with what analysts were expecting, based on a survey of analysts by Refinitiv:

• Earnings per share: $1.97 adjusted vs. $1.78 expected
• Revenue: $73.79 billion vs. $70.49 billion expected

The drugstore chain’s sales got a lift as consumers came to stores for Covid-19 tests and vaccines. The company said it administered more than 8 million tests and more than 11 million shots during the three-month period.

Pharmacy volumes have also normalized compared to a year ago, as people go to the doctor office more regularly and get new prescriptions. Total pharmacy claims processed increased 5.3% on a 30-day equivalent basis during the quarter versus the year-ago period, when Covid vaccines were excluded. That rose to nearly 7% when including vaccines.

CVS reported third-quarter net income of $1.59 billion, or $1.20 per share, down from $1.22 billion, or 93 cents per share, a year earlier.

Excluding items, it earned $1.97 per share, more than the $1.78 per share expected by analysts surveyed by Refinitiv.

Total revenues for the three-month period jumped by about 10% to $73.79 billion from $67.06 billion a year earlier, outpacing expectations of $70.49 billion.

As of Tuesday’s close, shares of CVS were up about 33% this year. Shares touched a 52-week high on Tuesday, but closed at $91.15. The company’s market value is $120.28 billion.

Read the company’s press release here.