CVS Tops Earnings Forecast, Boosts 2021 Guidance on Pharmacy Sales Gains

Solid revenue gains in pharmacy and retail help CVS to a stronger-than-expected first-quarter profit of $2.04 a share.
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CVS Health  (CVS) - Get Report posted stronger-than-expected first quarter earnings Tuesday, and boosted its full-year profit guidance, as retail and pharmacy services sales got a lift from customers seeking coronavirus vaccinations and tests. 

CVS said adjusted earnings for the three months ending in March were pegged at $2.04 per share, up 6.8% from the same period last year and well ahead of the Street consensus forecast of $1.72 per share. Group revenues, CVS said, rose 3.5% from last year to $69.1 billion, again topping analysts' estimates of a $68.4 billion tally.

Looking into the 2021 financial year, CVS lifted its forecast for adjusted earnings, which it now sees in the region of $7.56 to $7.68 per share, from its prior forecast of 7.39 to $7.55 per share.

"We delivered strong first quarter results and improved our outlook for the year," said CEO Karen Lynch. "We continue to execute on our strategy while simultaneously managing through a pandemic, helping the country on the road to recovery."

"Our unmatched assets and strength of our brand are driving results as we work toward improving care delivery and driving growth," she added.  

CVS shares were marked 2.5% higher in early trading following the earnings release to change hands at $79.57 each, extending its six-month gain to around 31.8%.

Pharmacy Services revenues rose 3.8% to $36.067 billion, CVS said, Retail sales rose 2.3% to $23.274 billion, "driven by increased COVID-19 diagnostic testing and vaccinations and brand inflation". The group's healthcare benefits division saw sales rise 7.5% to $18.94 billion as it added Aetna's operations to its legacy business.