CVS Stock Could Still Soar in 2018 After Rocket Start

Despite starting the year off with a near-8% rally, CVS Health stock could climb another 15% this year, analysts say.

Author:: Bret Kenwell
Publish date:: Jan 5, 2018 1:00 PM EST

It's hard not to notice the sudden interest Wall Street has taken in shares of CVS Health Corporation (CVS) - Get Report . The stock is up almost 4% Friday after several analysts bumped their price targets on the stock.

The retailer is now up a whopping 7.7% so far on the year, which has only seen four trading days. "They are re-adjusting their business model and I think it's not done going higher," TheStreet's Jim Cramer said on CNBC's "Stop Trading" segment.

Don't forget, CVS recently announced its $69 billion acquisition of Aetna (AET) , a move that underscores how the company is trying to transform itself for a new future. Given the strides that Amazon.com, Inc. (AMZN) - Get Report is taking in retail, CVS' adaption shouldn't come as much of a surprise.

Investors had turned their back on a number of other retailers that didn't deserve it, he reasoned, naming stocks like Home Depot (HD) - Get Report , Costco (COST) - Get Report and Kroger (KR) - Get Report .

"I like it very much," Cramer, who also manages the Action Alerts PLUS charitable trust portfolio, said of CVS. He's not alone, either.

SunTrust analysts hiked their price target to $90 from $85, while analysts at Morgan Stanley bumped their target to $88 from $81.

At $90, we're talking about 15.4% upside from current levels. And that's after the stock's rowdy start to 2018, too. In other words, it could still be a big year for CVS stock.

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At the time of publication, Cramer's Action Alerts PLUS had no position in any security mentioned.