CVS HEALTH CORP (CVS) Stock Fundamental Analysis
USA - NYSE:CVS - US1266501006 - Common Stock
74 USD
+0.52 (+0.71%)
74 USD
0 (0%)
Overall CVS gets a fundamental rating of 4 out of 10. We evaluated CVS against 101 industry peers in the Health Care Providers & Services industry. There are concerns on the financial health of CVS while its profitability can be described as average. CVS is valued quite cheap, 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.
CVS had a positive operating cash flow in the past year.
In the past 5 years CVS has always been profitable.
In the past 5 years CVS always reported a positive cash flow from operatings.
1.2 Ratios
CVS has a Return On Assets (1.75%) which is in line with its industry peers.
With a decent Return On Equity value of 5.86%, CVS is doing good in the industry, outperforming 64.36% of the companies in the same industry.
Looking at the Return On Invested Capital, with a value of 4.57%, CVS is in line with its industry, outperforming 55.45% of the companies in the same industry.
Measured over the past 3 years, the Average Return On Invested Capital for CVS is below the industry average of 9.19%.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 1.75% | ||
| ROE | 5.86% | ||
| ROIC | 4.57% |
ROA(3y)2.35%
ROA(5y)2.72%
ROE(3y)7.68%
ROE(5y)8.81%
ROIC(3y)6.22%
ROIC(5y)6.35%
1.3 Margins
The Profit Margin of CVS (1.17%) is comparable to the rest of the industry.
CVS's Profit Margin has declined in the last couple of years.
Looking at the Operating Margin, with a value of 2.65%, CVS is in line with its industry, outperforming 52.48% of the companies in the same industry.
In the last couple of years the Operating Margin of CVS has declined.
With a Gross Margin value of 13.82%, CVS is not doing good in the industry: 66.34% of the companies in the same industry are doing better.
In the last couple of years the Gross Margin of CVS has declined.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 2.65% | ||
| PM (TTM) | 1.17% | ||
| GM | 13.82% |
OM growth 3Y-19.77%
OM growth 5Y-11.12%
PM growth 3Y-23.26%
PM growth 5Y-13.69%
GM growth 3Y-8.24%
GM growth 5Y-18.43%
2. Health
2.1 Basic Checks
With a Return on Invested Capital (ROIC) below the Cost of Capital (WACC), CVS is destroying 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 2.20 indicates that CVS is not a great score, but indicates only limited risk for bankruptcy at the moment.
CVS's Altman-Z score of 2.20 is in line compared to the rest of the industry. CVS outperforms 51.49% of its industry peers.
The Debt to FCF ratio of CVS is 13.91, which is on the high side as it means it would take CVS, 13.91 years of fcf income to pay off all of its debts.
The Debt to FCF ratio of CVS (13.91) is comparable to the rest of the industry.
CVS has a Debt/Equity ratio of 0.78. This is a neutral value indicating CVS is somewhat dependend on debt financing.
Looking at the Debt to Equity ratio, with a value of 0.78, CVS is in line with its industry, outperforming 43.56% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.78 | ||
| Debt/FCF | 13.91 | ||
| Altman-Z | 2.2 |
ROIC/WACC0.58
WACC7.89%
2.3 Liquidity
CVS has a Current 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 has a Current ratio of 0.80. This is amonst the worse of the industry: CVS underperforms 84.16% of its industry peers.
A Quick Ratio of 0.62 indicates that CVS may have some problems paying its short term obligations.
CVS's Quick ratio of 0.62 is on the low side compared to the rest of the industry. CVS is outperformed by 85.15% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 0.8 | ||
| Quick Ratio | 0.62 |
3. Growth
3.1 Past
The earnings per share for CVS have decreased strongly by -15.13% in the last year.
The Earnings Per Share has been decreasing by -5.20% on average over the past years.
Looking at the last year, CVS shows a small growth in Revenue. The Revenue has grown by 6.44% in the last year.
CVS shows a small growth in Revenue. Measured over the last years, the Revenue has been growing by 7.74% yearly.
EPS 1Y (TTM)-15.13%
EPS 3Y-13.62%
EPS 5Y-5.2%
EPS Q2Q%-1.09%
Revenue 1Y (TTM)6.44%
Revenue growth 3Y8.47%
Revenue growth 5Y7.74%
Sales Q2Q%8.42%
3.2 Future
Based on estimates for the next years, CVS will show a quite strong growth in Earnings Per Share. The EPS will grow by 10.99% on average per year.
CVS is expected to show a small growth in Revenue. In the coming years, the Revenue will grow by 4.84% yearly.
EPS Next Y18.42%
EPS Next 2Y15.4%
EPS Next 3Y14.5%
EPS Next 5Y10.99%
Revenue Next Year5.85%
Revenue Next 2Y5.12%
Revenue Next 3Y5.31%
Revenue Next 5Y4.84%
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 accelerating.
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 11.67.
CVS's Price/Earnings ratio is rather cheap when compared to the industry. CVS is cheaper than 87.13% of the companies in the same industry.
CVS is valuated cheaply when we compare the Price/Earnings ratio to 27.20, which is the current average of the S&P500 Index.
CVS is valuated reasonably with a Price/Forward Earnings ratio of 10.25.
Based on the Price/Forward Earnings ratio, CVS is valued cheaply inside the industry as 84.16% of the companies are valued more expensively.
CVS is valuated cheaply when we compare the Price/Forward Earnings ratio to 22.70, which is the current average of the S&P500 Index.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 11.67 | ||
| Fwd PE | 10.25 |
4.2 Price Multiples
Based on the Price/Free Cash Flow ratio, CVS is valued a bit cheaper than the industry average as 64.36% of the companies are valued more expensively.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 19.64 | ||
| EV/EBITDA | N/A |
4.3 Compensation for Growth
CVS's low PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a rather cheap valuation of the company.
A more expensive valuation may be justified as CVS's earnings are expected to grow with 14.50% in the coming years.
PEG (NY)0.63
PEG (5Y)N/A
EPS Next 2Y15.4%
EPS Next 3Y14.5%
5. Dividend
5.1 Amount
CVS has a Yearly Dividend Yield of 3.56%.
Compared to an average industry Dividend Yield of 2.43, CVS pays a better dividend. On top of this CVS pays more dividend than 98.02% of the companies listed in the same industry.
CVS's Dividend Yield is a higher than the S&P500 average which is at 2.38.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 3.56% |
5.2 History
The dividend of CVS has a limited annual growth rate of 5.72%.
CVS has been paying a dividend for at least 10 years, so it has a reliable track record.
CVS has not decreased their dividend for at least 10 years, which is a reliable track record.
Dividend Growth(5Y)5.72%
Div Incr Years3
Div Non Decr Years28
5.3 Sustainability
74.62% of the earnings are spent on dividend by CVS. This is not a sustainable payout ratio.
The dividend of CVS is growing, but earnings are growing more, so the dividend growth is sustainable.
DP74.62%
EPS Next 2Y15.4%
EPS Next 3Y14.5%
74
+0.52 (+0.71%)
Chartmill FA Rating
GICS SectorHealth Care
GICS IndustryGroupHealth Care Equipment & Services
GICS IndustryHealth Care Providers & Services
Earnings (Last)
Earnings (Next)
Inst Owners87.14%
Inst Owner Change-0.54%
Ins Owners0.99%
Ins Owner Change6.3%
Market Cap93.86B
Analysts79.39
Price Target82.25 (11.15%)
Short Float %1.5%
Short Ratio2.42
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 3.56% |
Yearly Dividend2.65
Dividend Growth(5Y)5.72%
DP74.62%
Div Incr Years3
Div Non Decr Years28
Ex-Date
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)26.87%
Min EPS beat(2)22.99%
Max EPS beat(2)30.76%
EPS beat(4)3
Avg EPS beat(4)13.15%
Min EPS beat(4)-28.4%
Max EPS beat(4)30.76%
EPS beat(8)6
Avg EPS beat(8)5.23%
EPS beat(12)10
Avg EPS beat(12)4.69%
EPS beat(16)14
Avg EPS beat(16)4.93%
Revenue beat(2)2
Avg Revenue beat(2)1.83%
Min Revenue beat(2)0.02%
Max Revenue beat(2)3.64%
Revenue beat(4)3
Avg Revenue beat(4)1.27%
Min Revenue beat(4)-0.46%
Max Revenue beat(4)3.64%
Revenue beat(8)5
Avg Revenue beat(8)0.67%
Revenue beat(12)9
Avg Revenue beat(12)2.1%
Revenue beat(16)13
Avg Revenue beat(16)2.16%
PT rev (1m)2.16%
PT rev (3m)2.49%
EPS NQ rev (1m)-1.98%
EPS NQ rev (3m)-5.25%
EPS NY rev (1m)3.6%
EPS NY rev (3m)4.02%
Revenue NQ rev (1m)0.29%
Revenue NQ rev (3m)1.04%
Revenue NY rev (1m)1.74%
Revenue NY rev (3m)1.64%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 11.67 | ||
| Fwd PE | 10.25 | ||
| P/S | 0.24 | ||
| P/FCF | 19.64 | ||
| P/OCF | 12.4 | ||
| P/B | 1.21 | ||
| P/tB | N/A | ||
| EV/EBITDA | N/A |
EPS(TTM)6.34
EY8.57%
EPS(NY)7.22
Fwd EY9.75%
FCF(TTM)3.77
FCFY5.09%
OCF(TTM)5.97
OCFY8.06%
SpS304.84
BVpS61.01
TBVpS-31.58
PEG (NY)0.63
PEG (5Y)N/A
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 1.75% | ||
| ROE | 5.86% | ||
| ROCE | 6.23% | ||
| ROIC | 4.57% | ||
| ROICexc | 5% | ||
| ROICexgc | 21.47% | ||
| OM | 2.65% | ||
| PM (TTM) | 1.17% | ||
| GM | 13.82% | ||
| FCFM | 1.24% |
ROA(3y)2.35%
ROA(5y)2.72%
ROE(3y)7.68%
ROE(5y)8.81%
ROIC(3y)6.22%
ROIC(5y)6.35%
ROICexc(3y)6.76%
ROICexc(5y)6.87%
ROICexgc(3y)25.87%
ROICexgc(5y)25.07%
ROCE(3y)8.35%
ROCE(5y)8.51%
ROICexcg growth 3Y-10.65%
ROICexcg growth 5Y-1.15%
ROICexc growth 3Y-14.28%
ROICexc growth 5Y-4.08%
OM growth 3Y-19.77%
OM growth 5Y-11.12%
PM growth 3Y-23.26%
PM growth 5Y-13.69%
GM growth 3Y-8.24%
GM growth 5Y-18.43%
F-Score5
Asset Turnover1.5
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.78 | ||
| Debt/FCF | 13.91 | ||
| Debt/EBITDA | N/A | ||
| Cap/Depr | N/A | ||
| Cap/Sales | 0.72% | ||
| Interest Coverage | -3.41 | ||
| Cash Conversion | N/A | ||
| Profit Quality | 105.5% | ||
| Current Ratio | 0.8 | ||
| Quick Ratio | 0.62 | ||
| Altman-Z | 2.2 |
F-Score5
WACC7.89%
ROIC/WACC0.58
Cap/Depr(3y)N/A
Cap/Depr(5y)N/A
Cap/Sales(3y)0.81%
Cap/Sales(5y)0.84%
Profit Quality(3y)191.23%
Profit Quality(5y)191.5%
High Growth Momentum
Growth
EPS 1Y (TTM)-15.13%
EPS 3Y-13.62%
EPS 5Y-5.2%
EPS Q2Q%-1.09%
EPS Next Y18.42%
EPS Next 2Y15.4%
EPS Next 3Y14.5%
EPS Next 5Y10.99%
Revenue 1Y (TTM)6.44%
Revenue growth 3Y8.47%
Revenue growth 5Y7.74%
Sales Q2Q%8.42%
Revenue Next Year5.85%
Revenue Next 2Y5.12%
Revenue Next 3Y5.31%
Revenue Next 5Y4.84%
EBIT growth 1Y-20.52%
EBIT growth 3Y-12.98%
EBIT growth 5Y-4.24%
EBIT Next Year42.57%
EBIT Next 3Y19.26%
EBIT Next 5Y18.23%
FCF growth 1Y-72.95%
FCF growth 3Y-26.21%
FCF growth 5Y-9.45%
OCF growth 1Y-63.11%
OCF growth 3Y-20.7%
OCF growth 5Y-6.65%