CVS Health (CVS) reported earnings on Tue 2 Aug 2016 (b/o)

** chart 5 days before earnings **

** charts after earnings **

 

**   10 days later **

CVS Health beats by $0.02, misses on revs; guides Q3 EPS in-line; raises/narrows FY16 EPS :

• Reports Q2 (Jun) earnings of $1.32 per share, excluding non-recurring items, $0.02 better than the Capital IQ Consensus of $1.30; revenues rose 17.6% year/year to $43.73 bln vs the $44.28 bln Capital IQ Consensus. 
  • Revenues in the Pharmacy Services Segment increased 20.7%, or $5.1 billion, to $29.5 billion in the three months ended June 30, 2016. The increase was primarily driven by increased pharmacy network claim volume and growth in specialty pharmacy. Pharmacy network claims processed during the three months ended June 30, 2016 increased 22.6% to 280.5 million, compared to 228.8 million in the prior year.
  • Revenues in the Retail/LTC Segment increased 16.0%, or $2.8 billion, to ~$20.0 billion, in the three months ended June 30, 2016. The increase was primarily driven by the addition of the long-term care pharmacy operations acquired as part of the acquisition of Omnicare, Inc. in August 2015, the addition of the pharmacies and clinics of Target Corporation acquired in December 2015 and pharmacy same store sales growth. Same store sales increased 2.1%. Pharmacy same store sales rose 3.9% and pharmacy same store prescription volumes rose 3.5% on a 30-day equivalent basis. Pharmacy same store sales were negatively affected by ~355 basis points from recent generic drug introductions. Front store same store sales decreased 2.5%, including the effect of the shift of Easter from April in 2015 to March in 2016, which resulted in a decrease in front store same store sales of ~80 basis points. Front store same store sales were also negatively affected by softer customer traffic, partially offset by an increase in basket size.