NEW YORK (TheStreet) -- Shares of CVS Health Corp. (CVS - Get Report) are down by 4.37% to $107.89 at the start of trading on Tuesday morning, after the company gave earnings guidance for the current quarter that was below analysts' expectations.
For the 2015 third quarter, CVS has estimated that it will report earnings of $1.27 to $1.30 per share, short of the $1.37 per share analysts surveyed by Thomson Reuters forecast.
CVS also narrowed its adjusted full year 2015 EPS guidance to a range of $5.11 to $5.18 per share versus the $5.08 to $5.19 per share range the company had previously estimated.
However, for the 2015 second quarter CVS reported better than expected earnings results.
For the most recent quarter the healthcare retailer and pharmacy said its adjusted earnings came in at $1.22 per share on net revenue of $37.2 billion.
Analysts surveyed by Thomson Reuters had forecast for earnings of $1.20 per share on revenue of $37.18 billion for the 2015 second quarter.
Insight from TheStreet Research Team:
Model portfolio holding CVS Health reported solid second-quarter results today and raised the low end of its 2015 full-year earnings guidance.
The pharmacy benefit management (PBM) business saw volume increase on stronger retail claims, up 8.7% year over year to 229 million. The PBM now has $12 billion in gross wins ($11 billion in net wins) for the 2015 selling season, up $4.5 billion from the last update. It has completed 60% of 2016 renewals already, which is typical for this time period.
Same-store sales grew 0.5% from last year (down from 1.2% last quarter). Pharmacy same-store sales increased 4.1% (4.2% last quarter), while front-store same-store sales decreased 7.8% (compared with a 6.1% decrease last quarter). Front-store same-store sales were negatively affected by softer customer traffic, partially offset by an increase in basket size.
Management said they expect to close the Omnicare (OCR) acquisition before the end of the year, perhaps as early as the third quarter, and closing the Target (TGT) pharmacies deal remains uncertain as to this year or next.
-Bryan Ashenberg and Bob Lang "CVS Reports Healthy Results" Originally published on 8/4/2015 on Trifecta Stocks.
Want more like this from Ashenberg and Lang BEFORE your stock moves? Learn more about Trifecta Stocks now!
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, growth in earnings per share, increase in net income, largely solid financial position with reasonable debt levels by most measures and solid stock price performance. We feel its strengths outweigh the fact that the company shows low profit margins."
You can view the full analysis from the report here: CVS Ratings ReportCVS data by YCharts