CVS To Update Its Long-Term Guidance In December

The firm's analysts have cited recent increased pharmacy benefit management competition, partnerships with Walgreens Boots Alliance Inc WBA attracting prescription traffic and the Tricare contract change as reasons for trimming their outlook.

Due to these catalysts, the 2017 EPS outlook has been cut by 17 cents per share to $6.38 versus a consensus estimate of $6.54.

"We believe many investors expect CVS to reduce the EPS guidance range from the current 10–14 percent EPS growth target," said the bank.

Deutsche Bank cited Walgreens' new initiatives to disrupt the pharmacy landscape as having been under appreciated and will weigh on CVS in the near future. CVS is expected to update its forward guidance at its analyst day in December.

Related Link: Why Walgreens Is A Buy, Regardless Of Rite Aid Deal

"Walgreens will put increasing price pressure on the CVS retail business as it has to match a more aggressive Walgreens on price, and also on the Caremark PBM," said the analysts.

Deutsche Bank maintains a Hold rating on CVS and has lowered its price target to $99 from $108.

At last check, CVS was down 2.03 percent at $87.

Full ratings data available on Benzinga Pro.