CVS Rallies as Guidance Gets a Boost, New CEO Named By Investing.com


© Reuters.

By Christiana Sciaudone

Investing.com — CVS Health Corp (NYSE:) rose 10% after the company raised guidance and named a new chief.

Adjusted earnings per share guidance for full-year 2020 is expected to range between $7.35 to $7.45, up from $7.14 to $7.27. Cash flow from operations should be between $12.75 billion to $13.25 billion, up from $11.0 billion to $11.5 billion.

Third quarter earnings per share of $1.66 compared to the expected $1.33 on sales of $67.06 billion versus the estimated $66.51 billion, according to analysts tracked by Investing.com.

The healthcare company also named Karen S. Lynch as its next president and chief executive officer, replacing Larry J. Merlo, who will retire next year. Lynch is currently executive vice president at CVS and president of Aetna (NYSE:). She will lead CVS effective Feb. 1, when she will also join the board of directors. 

“Our strong third quarter results demonstrate continued execution of our long-term strategic plan that is transforming the way health care is delivered,” Merlo said in a statement. “We’ve opened more than 4,000 COVID-19 test sites across the country since March, and have administered over six million tests. We’re helping businesses and universities safely reopen and we were recently selected to administer COVID-19 vaccinations in long-term care facilities.”

CVS bought healthcare insurer Aetna two years ago as it sought to expand, and just completed its first year as a joint company.

Total revenue increased 3.5% compared to the prior year driven by growth in the health care benefits, which rose 8.8%, and retail segments, up 5.9%. Pharmacy sales dropped 0.9%.

 

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