Will CVS Health (CVS) Stock be Helped Today by 2015 Guidance?

NEW YORK (TheStreet) --CVS Health Corp. (CVS) issued its 2015 guidance and outlined its plans for "sustainable enterprise growth" on Tuesday morning.

The pharmacy, healthcare provider, and retailer said its 2015 adjusted earnings per share is expected to be in the range of $5.05 to $5.19, a 12.5% to 15.75% increase over the previous year.

Shares of CVS Health are up by 0.26% to $90.10 in pre-market trading this morning.

STOCKS TO BUY: TheStreet Quant Ratings has identified a handful of stocks that can potentially TRIPLE in the next 12 months. Learn more.

"We've established a solid track record of delivering on our promises, and our results prove that out. Looking ahead, we are targeting solid, long term enterprise growth and expect to generate a significant amount of cash that will be available to enhance returns," said CVS executive vice president and CFO Dave Denton.

Additionally, CVS Health announced a 27% increase to its quarterly dividend, to 35 cents per share of common stock. The company also announced the approval of a new $10 billion share repurchase program, relating to CVS Health's outstanding stock.

Separately, TheStreet Ratings team rates CVS HEALTH CORP as a Buy with a ratings score of A+. TheStreet Ratings Team has this to say about their recommendation:

"We rate CVS HEALTH CORP (CVS) a BUY. This is based on the convergence of positive investment measures, which should help this stock outperform the majority of stocks that we rate. The company's strengths can be seen in multiple areas, such as its revenue growth, solid stock price performance, largely solid financial position with reasonable debt levels by most measures and notable return on equity. We feel these strengths outweigh the fact that the company has had sub par growth in net income."

Highlights from the analysis by TheStreet Ratings Team goes as follows:

  • The revenue growth came in higher than the industry average of 1.2%. Since the same quarter one year prior, revenues slightly increased by 9.7%. This growth in revenue does not appear to have trickled down to the company's bottom line, displayed by a decline in earnings per share.
  • Compared to its closing price of one year ago, CVS's share price has jumped by 33.44%, exceeding the performance of the broader market during that same time frame. Regarding the stock's future course, although almost any stock can fall in a broad market decline, CVS should continue to move higher despite the fact that it has already enjoyed a very nice gain in the past year.
  • CVS HEALTH CORP's earnings per share declined by 20.6% in the most recent quarter compared to the same quarter a year ago. This company has reported somewhat volatile earnings recently. But, we feel it is poised for EPS growth in the coming year. During the past fiscal year, CVS HEALTH CORP increased its bottom line by earning $3.75 versus $3.03 in the prior year. This year, the market expects an improvement in earnings ($4.50 versus $3.75).
  • The current debt-to-equity ratio, 0.34, is low and is below the industry average, implying that there has been successful management of debt levels. Despite the fact that CVS's debt-to-equity ratio is low, the quick ratio, which is currently 0.66, displays a potential problem in covering short-term cash needs.
  • The return on equity has improved slightly when compared to the same quarter one year prior. This can be construed as a modest strength in the organization. When compared to other companies in the Food & Staples Retailing industry and the overall market, CVS HEALTH CORP's return on equity is below that of both the industry average and the S&P 500.
  • You can view the full analysis from the report here: CVS Ratings Report

STOCKS TO BUY: TheStreet Quant Ratings has identified a handful of stocks that can potentially TRIPLE in the next 12 months. Learn more.

More from Markets

China Trade War, Google, JD.com, Tesla, Brooks Koepka - 5 Things You Must Know

China Trade War, Google, JD.com, Tesla, Brooks Koepka - 5 Things You Must Know

Stocks Dive Globally as U.S.-China Trade War Intensifies

Stocks Dive Globally as U.S.-China Trade War Intensifies

Global Oil Prices Mixed as OPEC Production Talks, China Tariffs Weigh on Markets

Global Oil Prices Mixed as OPEC Production Talks, China Tariffs Weigh on Markets

Cryptocurrencies Could 'Bring the Internet to a Halt', Central Bank Agency Warns

Cryptocurrencies Could 'Bring the Internet to a Halt', Central Bank Agency Warns

Volkswagen's Audi CEO Arrested in Diesel Emissions Probe

Volkswagen's Audi CEO Arrested in Diesel Emissions Probe