CVS Reports 3Q Earnings While Stock Remains Cheap (CVS)

JP Morgan published a follow-up report on CVS Caremark Corporation CVS after the company reported its 3Q earnings yesterday morning. In the report, JP Morgan writes "the updated guidance appears to be entirely based on the $55-$60M in incremental PBM streamlining costs in 2H10 that were not included in prior guidance which equate to an EPS impact of roughly $0.02-$0.03. We remain positive on CVS Caremark, as we believe the company should continue to gain traction on the PBM side, the retail business continues to perform well in a tough economy, and based on strong free cash flow generation capabilities. Below, we provide some quick takeaways from the call and discuss our estimate revisions." JP Morgan maintains its Overweight rating and $44 price target. CVS Caremark Corporation closed yesterday at $30.87.