Log in
E-mail
Password
Remember
Forgot password ?
Become a member for free
Sign up
Sign up
Settings
Settings
Dynamic quotes 
OFFON

4-Traders Homepage  >  Equities  >  Nyse  >  CVS Health    CVS

CVS HEALTH (CVS)
Mes dernières consult.
Most popular
Report
SummaryQuotesChartsNewsAnalysisCalendarCompanyFinancialsConsensusRevisions 
News SummaryMost relevantAll newsSector newsTweets

CVS Caremark 4th-Quarter Profit Up 2.6% on Higher Sales

share with twitter share with LinkedIn share with facebook
share via e-mail
0
02/06/2013 | 05:11pm CET

--Debt refinancing costs weigh on bottom line, but sales broadly higher

--PBM, retail sales each rise, helping CVS report better-than-expected results

--Purchased Brazil drugstore chain Drogaria Onofre last week

(Updates with details about an acquisition and other comments made during a conference call, beginning in the seventh paragraph.)

 
   By John Kell 
 

CVS Caremark Corp.'s (>> CVS Caremark Corporation) fourth-quarter earnings rose 2.6% as debt refinancing costs weighed on the bottom line, somewhat masking a strong performance for the company's pharmacy-benefits-management business and higher retail sales.

The drugstore retailer and PBM has now reported better-than-expected adjusted earnings for four consecutive quarters. Results in the fourth quarter were led by the PBM business, which saw revenue rise 17% to $18.6 billion, aided by new clients added to the network during the 2012 PBM selling season, higher drug costs and growth in the Medicare Part D program.

On the retail side, the top line jumped 5.1% to $16.3 billion as same-store sales grew 4%, growth that exceeds the monthly sales data posted by rivals Walgreen Co. (>> Walgreen Company) and Rite Aid Corp. (>> Rite Aid Corporation) in late 2012. Prescription volume growth was healthy, aided by client wins after Walgreen's contract dispute last year with fellow PBM Express Scripts Holding Co. (>> Express Scripts Holding Co) and stronger demand for flu-related prescriptions.

But CVS said pharmacy same-store sales were stung by higher usage of low-priced generics, which hurts the top line for drug store chains, though those products have a mixed benefit as they command higher margins.

An active flu season has helped drugstore chains somewhat mitigate the top-line dent caused by higher generic penetration, as consumers seek out vaccinations, order prescriptions and buy over-the-counter cough-and-cold medications. CVS Chief Executive Larry Merlo told Dow Jones Newswires that the company saw a "significant uptick" in flu activity by mid-December and strong demand through most of January.

Mr. Merlo said over the past two weeks, CVS has seen the severity of flu cases moderate. Still, the company has administered about 4.8 million flu shots so far this season, above last year's level.

In a conference call with analysts, CVS disclosed it purchased Brazil drugstore chain Drogaria Onofre last week, though no price tag was disclosed as CVS called the deal "not financially material."

CVS will acquire 44 locations through the deal, the company's first acquisition abroad. The purchase comes more than six months after Walgreen agreed to spend $6.7 billion to buy a 45% stake in European pharmacy operator Alliance Boots.

CVS said it views Brazil as an attractive market, saying that region's health-care and pharmacy segments should grow in double digits for the next decade.

Overall, CVS reported a profit of $1.13 billion, or 90 cents a share, up from $1.1 billion, or 81 cents a share, a year earlier. Excluding debt-related costs and other items, adjusted earnings from continuing operations were $1.14 in the latest quarter. Revenue increased 11% to $31.39 billion.

Analysts polled by Thomson Reuters most recently projected earnings of $1.10 on revenue of $31.13 billion.

Gross margin expanded to 20.1% from 19.6%.

For the year, CVS now sees adjusted earnings from continuing operations of $3.86 to $4, a view that was lifted by two cents to reflect the debt refinancing.

CVS will face some lofty comparisons in 2013, due to strong demand for generics, particularly in the first half of the year. And after Walgreen inked a contract agreement with Express Scripts starting in September, the company has had some success winning back some customers it lost to competitors during the months-long spat, resulting in some lost business for CVS.

Walgreen has sought to strengthen its core business with its new loyalty-card program and by selling more private-label offerings. CVS on Wednesday indicated it is staying focused on retaining customer loyalty by launching more targeted promotions and e-mail offers.

CVS last week launched a pharmacy rewards program to promote retention and better prescription adherence. CVS has also doubled the amount of e-mails it sends and is seeing greater interest in the beauty-product deals it offers. Overall, CVS posted a 19% jump in the amount of offers redeemed by consumers last year.

CVS shares were down 0.2% to $51.61 in recent trading. The stock is up 6.7% in 2013.

 
  --Tess Stynes contributed to this article 

Write to John Kell at [email protected]

Subscribe to WSJ: http://online.wsj.com?mod=djnwires

share with twitter share with LinkedIn share with facebook
share via e-mail
0
Latest news on CVS HEALTH
11/21 CVS PHARMACY : 's Exclusive Black Friday and Cyber Monday promotions help custom..
11/20 REPORT : Buyout of Aetna Inc. Could Come This Month
11/20DJCVS HEALTH : Takeovers Roar to Life as Companies Hear Footsteps From Tech Giants
11/20 SUPPORTING BETTER HEALTH ACROSS THE : CVS Health Impact Dashboard
11/16 CVS HEALTH : Makes Overdose-Reversal Drug Available Without Individual Prescript..
11/16 CVS HEALTH : Earns Perfect Score in 2018 Corporate Equality Index
11/16 CVS HEALTH : Surescripts Transforms Prescription Decision Process Between Physic..
11/15 CVS HEALTH : delivering next-day service come the new year
11/15 Bayer hires new blood to stem 'Amazon effect' in consumer health
11/15 CVS HEALTH : Delaware, CVS Health make overdose reversal drug available without ..
More news
News from SeekingAlpha
08:39a Mystery Stocks Revealed In My 88 Stock Portfolio Along With 2018 Income Estim..
12:01a Tracking Wallace Weitz's Weitz Investment Management Portfolio - Q3 2017 Upda..
11/21 NEW DIV ON THE BLOCK QUARTERLY EARNI : Part 2
11/21 15 Current Wall Street Favorites - Cramer's Mad Money (11/20/17)
11/20 Aetna perks up 1% on report that CVS takeover imminent
Financials ($)
Sales 2017 184 B
EBIT 2017 9 954 M
Net income 2017 5 242 M
Debt 2017 24 377 M
Yield 2017 2,73%
P/E ratio 2017 14,24
P/E ratio 2018 12,32
EV / Sales 2017 0,53x
EV / Sales 2018 0,50x
Capitalization 72 429 M
Chart CVS HEALTH
Duration : Period :
CVS Health Technical Analysis Chart | CVS | US1266501006 | 4-Traders
Technical analysis trends CVS HEALTH
Short TermMid-TermLong Term
TrendsBearishBearishBearish
Income Statement Evolution
Consensus
Sell
Buy
Mean consensus OUTPERFORM
Number of Analysts 24
Average target price 84,5 $
Spread / Average Target 18%
EPS Revisions
Managers
NameTitle
Larry J. Merlo President, CEO & Non-Independent Director
David Wyatt Dorman Chairman
Jonathan C. Roberts Chief Operating Officer & Executive Vice President
David M. Denton Chief Financial Officer & Executive Vice President
Troyen A. Brennan Chief Medical Officer & Executive Vice President
Sector and Competitors
1st jan.Capitalization (M$)
CVS HEALTH-10.43%72 429
WALGREENS BOOTS ALLIANCE-13.91%71 840
EXPRESS SCRIPTS HOLDING CO-9.96%34 656
MCKESSON CORPORATION1.20%29 785
CARDINAL HEALTH INC-20.09%17 564
AMERISOURCEBERGEN CORP.0.83%17 411