CVS HEALTH CORP (CVS) Stock Fundamental Analysis
NYSE:CVS - New York Stock Exchange, Inc. - US1266501006 - Common Stock
We assign a fundamental rating of 4 out of 10 to CVS. CVS was compared to 108 industry peers in the Health Care Providers & Services industry. CVS has a medium profitability rating, but doesn't score so well on its financial health evaluation. CVS has a valuation in line with the averages, but it does not seem to be growing. CVS also has an excellent dividend rating.
1. Profitability
1.1 Basic Checks
CVS had positive earnings in the past year.
In the past year CVS had a positive cash flow from operations.
Each year in the past 5 years CVS has been profitable.
Each year in the past 5 years CVS had a positive operating cash flow.
1.2 Ratios
CVS's Return On Assets of 1.99% is fine compared to the rest of the industry. CVS outperforms 62.62% of its industry peers.
The Return On Equity of CVS (6.69%) is better than 68.22% of its industry peers.
CVS has a Return On Invested Capital (4.94%) which is in line with its industry peers.
Measured over the past 3 years, the Average Return On Invested Capital for CVS is in line with the industry average of 8.27%.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 1.99% | ||
| ROE | 6.69% | ||
| ROIC | 4.94% |
ROA(3y)2.89%
ROA(5y)2.95%
ROE(3y)9.2%
ROE(5y)9.67%
ROIC(3y)7.03%
ROIC(5y)6.55%
1.3 Margins
CVS has a better Profit Margin (1.36%) than 63.55% of its industry peers.
In the last couple of years the Profit Margin of CVS has declined.
The Operating Margin of CVS (3.03%) is comparable to the rest of the industry.
CVS's Operating Margin has declined in the last couple of years.
CVS has a Gross Margin of 14.20%. This is in the lower half of the industry: CVS underperforms 73.83% of its industry peers.
In the last couple of years the Gross Margin of CVS has declined.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 3.03% | ||
| PM (TTM) | 1.36% | ||
| GM | 14.2% |
OM growth 3Y-6.75%
OM growth 5Y-4.2%
PM growth 3Y-4.43%
PM growth 5YN/A
GM growth 3Y-26.92%
GM growth 5Y-4.94%
2. Health
2.1 Basic Checks
The Return on Invested Capital (ROIC) is just above the Cost of Capital (WACC), so CVS is still creating some value.
CVS has less shares outstanding than it did 1 year ago.
Compared to 5 years ago, CVS has less shares outstanding
Compared to 1 year ago, CVS has a worse debt to assets ratio.
2.2 Solvency
An Altman-Z score of 2.09 indicates that CVS is not a great score, but indicates only limited risk for bankruptcy at the moment.
With a Altman-Z score value of 2.09, CVS perfoms like the industry average, outperforming 51.40% of the companies in the same industry.
CVS has a debt to FCF ratio of 38.85. This is a negative value and a sign of low solvency as CVS would need 38.85 years to pay back of all of its debts.
The Debt to FCF ratio of CVS (38.85) is comparable to the rest of the industry.
A Debt/Equity ratio of 0.81 indicates that CVS is somewhat dependend on debt financing.
CVS has a Debt to Equity ratio of 0.81. This is in the lower half of the industry: CVS underperforms 60.75% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.81 | ||
| Debt/FCF | 38.85 | ||
| Altman-Z | 2.09 |
ROIC/WACC0.72
WACC6.84%
2.3 Liquidity
A Current Ratio of 0.80 indicates that CVS may have some problems paying its short term obligations.
CVS has a Current ratio of 0.80. This is amonst the worse of the industry: CVS underperforms 85.05% of its industry peers.
CVS has a Quick Ratio of 0.80. This is a bad value and indicates that CVS is not financially healthy enough and could expect problems in meeting its short term obligations.
CVS's Quick ratio of 0.59 is on the low side compared to the rest of the industry. CVS is outperformed by 83.18% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 0.8 | ||
| Quick Ratio | 0.59 |
3. Growth
3.1 Past
The earnings per share for CVS have decreased strongly by -26.25% in the last year.
Measured over the past 5 years, CVS shows a small growth in Earnings Per Share. The EPS has been growing by 4.42% on average per year.
The Revenue has been growing slightly by 6.07% in the past year.
The Revenue has been growing by 12.95% on average over the past years. This is quite good.
EPS 1Y (TTM)-26.25%
EPS 3Y5.19%
EPS 5Y4.42%
EPS Q2Q%-50.68%
Revenue 1Y (TTM)6.07%
Revenue growth 3Y10.01%
Revenue growth 5Y12.95%
Sales Q2Q%6.31%
3.2 Future
Based on estimates for the next years, CVS will show a small growth in Earnings Per Share. The EPS will grow by 3.02% on average per year.
The Revenue is expected to grow by 4.71% on average over the next years.
EPS Next Y-39.16%
EPS Next 2Y-15.73%
EPS Next 3Y-6.45%
EPS Next 5Y3.02%
Revenue Next Year4.95%
Revenue Next 2Y4.56%
Revenue Next 3Y4.73%
Revenue Next 5Y4.71%
3.3 Evolution
When comparing the EPS growth rate of the last years to the growth rate of the upcoming years, we see that the growth is decreasing.
The Revenue growth rate is decreasing: in the next years the growth will be less than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
CVS is valuated reasonably with a Price/Earnings ratio of 8.29.
Based on the Price/Earnings ratio, CVS is valued cheaply inside the industry as 96.26% of the companies are valued more expensively.
The average S&P500 Price/Earnings ratio is at 27.94. CVS is valued rather cheaply when compared to this.
A Price/Forward Earnings ratio of 8.48 indicates a reasonable valuation of CVS.
Compared to the rest of the industry, the Price/Forward Earnings ratio of CVS indicates a rather cheap valuation: CVS is cheaper than 92.52% of the companies listed in the same industry.
When comparing the Price/Forward Earnings ratio of CVS to the average of the S&P500 Index (24.11), we can say CVS is valued rather cheaply.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 8.29 | ||
| Fwd PE | 8.48 |
4.2 Price Multiples
63.55% of the companies in the same industry are more expensive than CVS, based on the Price/Free Cash Flow ratio.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 39.25 | ||
| EV/EBITDA | N/A |
4.3 Compensation for Growth
CVS's earnings are expected to decrease with -6.45% in the coming years. This may justify a cheaper valuation.
PEG (NY)N/A
PEG (5Y)1.87
EPS Next 2Y-15.73%
EPS Next 3Y-6.45%
5. Dividend
5.1 Amount
CVS has a Yearly Dividend Yield of 5.12%, which is a nice return.
Compared to an average industry Dividend Yield of 2.87, CVS pays a better dividend. On top of this CVS pays more dividend than 98.13% of the companies listed in the same industry.
Compared to an average S&P500 Dividend Yield of 2.28, CVS pays a better dividend.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 5.12% |
5.2 History
The dividend of CVS is nicely growing with an annual growth rate of 6.52%!
CVS has paid a dividend for at least 10 years, which is a reliable track record.
CVS has not decreased their dividend for at least 10 years, which is a reliable track record.
Dividend Growth(5Y)6.52%
Div Incr Years3
Div Non Decr Years28
5.3 Sustainability
66.07% of the earnings are spent on dividend by CVS. This is not a sustainable payout ratio.
CVS's earnings are growing slower than its dividend. This means the dividend growth is not sustainable.
DP66.07%
EPS Next 2Y-15.73%
EPS Next 3Y-6.45%
CVS HEALTH CORP
NYSE:CVS (1/17/2025, 8:04:00 PM)
Premarket: 52.85 +0.23 (+0.44%)52.62
+0.66 (+1.27%)
Chartmill FA Rating
GICS SectorHealth Care
GICS IndustryGroupHealth Care Equipment & Services
GICS IndustryHealth Care Providers & Services
Earnings (Last)
Earnings (Next)
Inst Owners83.45%
Inst Owner Change-0.53%
Ins Owners0.05%
Ins Owner Change0.27%
Market Cap66.22B
Analysts75.76
Price Target67.1 (27.52%)
Short Float %1.44%
Short Ratio1.29
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 5.12% |
Yearly Dividend2.42
Dividend Growth(5Y)6.52%
DP66.07%
Div Incr Years3
Div Non Decr Years28
Ex-Date
Surprises & Revisions
EPS beat(2)1
Avg EPS beat(2)-11.86%
Min EPS beat(2)-28.4%
Max EPS beat(2)4.69%
EPS beat(4)2
Avg EPS beat(4)-10.43%
Min EPS beat(4)-28.4%
Max EPS beat(4)5.45%
EPS beat(8)6
Avg EPS beat(8)-3.58%
EPS beat(12)10
Avg EPS beat(12)-0.99%
EPS beat(16)14
Avg EPS beat(16)2.24%
Revenue beat(2)1
Avg Revenue beat(2)0.3%
Min Revenue beat(2)-1.27%
Max Revenue beat(2)1.87%
Revenue beat(4)2
Avg Revenue beat(4)0.37%
Min Revenue beat(4)-1.85%
Max Revenue beat(4)2.74%
Revenue beat(8)6
Avg Revenue beat(8)2.17%
Revenue beat(12)10
Avg Revenue beat(12)2.31%
Revenue beat(16)14
Avg Revenue beat(16)2.12%
PT rev (1m)-1.85%
PT rev (3m)2.88%
EPS NQ rev (1m)0%
EPS NQ rev (3m)-45.35%
EPS NY rev (1m)0%
EPS NY rev (3m)-19.44%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)1.01%
Revenue NY rev (1m)-0.09%
Revenue NY rev (3m)0.69%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 8.29 | ||
| Fwd PE | 8.48 | ||
| P/S | 0.18 | ||
| P/FCF | 39.25 | ||
| P/OCF | 14.36 | ||
| P/B | 0.88 | ||
| P/tB | N/A | ||
| EV/EBITDA | N/A |
EPS(TTM)6.35
EY12.07%
EPS(NY)6.21
Fwd EY11.79%
FCF(TTM)1.34
FCFY2.55%
OCF(TTM)3.66
OCFY6.96%
SpS293.16
BVpS59.55
TBVpS-35.08
PEG (NY)N/A
PEG (5Y)1.87
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 1.99% | ||
| ROE | 6.69% | ||
| ROCE | 6.66% | ||
| ROIC | 4.94% | ||
| ROICexc | 5.24% | ||
| ROICexgc | 20.91% | ||
| OM | 3.03% | ||
| PM (TTM) | 1.36% | ||
| GM | 14.2% | ||
| FCFM | 0.46% |
ROA(3y)2.89%
ROA(5y)2.95%
ROE(3y)9.2%
ROE(5y)9.67%
ROIC(3y)7.03%
ROIC(5y)6.55%
ROICexc(3y)7.66%
ROICexc(5y)7.07%
ROICexgc(3y)28.23%
ROICexgc(5y)25.21%
ROCE(3y)9.44%
ROCE(5y)8.79%
ROICexcg growth 3Y9.49%
ROICexcg growth 5Y3.72%
ROICexc growth 3Y2.28%
ROICexc growth 5Y6.42%
OM growth 3Y-6.75%
OM growth 5Y-4.2%
PM growth 3Y-4.43%
PM growth 5YN/A
GM growth 3Y-26.92%
GM growth 5Y-4.94%
F-Score5
Asset Turnover1.46
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.81 | ||
| Debt/FCF | 38.85 | ||
| Debt/EBITDA | N/A | ||
| Cap/Depr | N/A | ||
| Cap/Sales | 0.79% | ||
| Interest Coverage | -4.05 | ||
| Cash Conversion | N/A | ||
| Profit Quality | 33.63% | ||
| Current Ratio | 0.8 | ||
| Quick Ratio | 0.59 | ||
| Altman-Z | 2.09 |
F-Score5
WACC6.84%
ROIC/WACC0.72
Cap/Depr(3y)N/A
Cap/Depr(5y)N/A
Cap/Sales(3y)0.85%
Cap/Sales(5y)0.88%
Profit Quality(3y)211.12%
Profit Quality(5y)195.41%
High Growth Momentum
Growth
EPS 1Y (TTM)-26.25%
EPS 3Y5.19%
EPS 5Y4.42%
EPS Q2Q%-50.68%
EPS Next Y-39.16%
EPS Next 2Y-15.73%
EPS Next 3Y-6.45%
EPS Next 5Y3.02%
Revenue 1Y (TTM)6.07%
Revenue growth 3Y10.01%
Revenue growth 5Y12.95%
Sales Q2Q%6.31%
Revenue Next Year4.95%
Revenue Next 2Y4.56%
Revenue Next 3Y4.73%
Revenue Next 5Y4.71%
EBIT growth 1Y-25.47%
EBIT growth 3Y2.59%
EBIT growth 5Y8.21%
EBIT Next Year-12.47%
EBIT Next 3Y0.77%
EBIT Next 5YN/A
FCF growth 1Y-91.35%
FCF growth 3Y-8.18%
FCF growth 5Y8.77%
OCF growth 1Y-79.17%
OCF growth 3Y-5.41%
OCF growth 5Y8.66%