) -- A breakup between


(CVS) - Get Report

and its Caremark unit could present a big upside for the stock, according to an analyst.

If the two divisions were to split, it could mean as much as 30% upside for the stock, Credit Suisse analyst Edward Kelly wrote in a note.

But just how likely is a split between CVS and Caremark? Kelly noted that if Caremark's performance doesn't improve over the next year it could be highly likely.

"We find CVS's continued mismanagement of Caremark and its lack of insight into the underlying issues disturbing," he wrote. "That being said, we believe overwhelmingly negative investor sentiment has created a compelling risk/reward set-up in the stock. We continue to believe CVS's problems are fixable."

While Caremark is experiencing some fundamental problems, Kelly still believes it's an attractive asset for a potential buyer. He also said that while a sale would be the best bet for CVS, a spin-off could also help the drugstore.

In its fourth quarter, CVS reported lower profits and revenue and said it expects profit at its Caremark pharmacy benefits management to shrink further in 2011. This will mark the second consecutive year of profit declines at the division.

Wall Street expected the company would begin to see improvements at Caremark, but CVS said a new multi-year contract with Aetna will drag on results.

Other issues affecting Caremark include lower payments from pharmacy benefits programs for federal employees, less profitable contract renewals, and expenses related to cost cuts. CVS also said adjusted profit per prescription will continue to decline, moving closer to the levels reported by Caremark's competitors.

The company does expect Caremark profit to start to grow in 2012.

CVS acquired Caremark in 2007 for $27 billion.

--Written by Jeanine Poggi in New York.

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