UPDATE: CVS Q3 Earnings Top Estimates

CVS

reported upbeat earnings for the third quarter and narrowed its earnings forecast for the year. The Woonsocket, Rhode Island-based company posted a quarterly profit of $948 million, or $0.82 per share, versus a year-ago profit of $1.25 billion, or $1.03 per share. Excluding items, the company's earnings fell to $0.88 per share, from $1.09 per share. Excluding certain items, the company earned $1.15 per share. The company had expected earnings of $1.11 to $1.14 per share. Its revenue climbed 9.7% to $35.02 billion. However, analysts were expecting earnings of $1.13 per share on revenue of $34.73 billion. Overall same-store sales gained 2%, while pharmacy sales climbed 4.8%. Revenue for the retail pharmacy business gained 3.1% to $16.7 billion, while revenue for the pharmacy services rose 15.7% to $22.5 billion. The company's operating expenses rose 9% to $4.22 billion, while gross margin shrank to 18.5% from 18.9%. During the quarter, CVS opened 45 new and acquired 33 retail drugstores, and closed four retail drugstores. President and Chief Executive Officer Larry Merlo stated, "I'm very pleased with our strong results in the third quarter, which reflect better-than-expected revenue growth across the enterprise and expanding retail gross margins.” CVS now expects full-year earnings of $4.47 to $4.50 per share, versus its earlier forecast of $4.43 to $4.51 per share. For the current quarter, the company projects earnings of $1.18 to $1.21 per share, versus analysts' estimates of $1.21 per share. CVS shares rose 0.44% to $86.50 in pre-market trading.