JP Morgan's Diagnosis for CVS: Overweight

JP Morgan analysts maintained their overweight rating for CVS

. Chief competitor Walgreens announced that it will no longer do business with CVS Caremark's pharmacy benefits management operations. JP Morgan believes this was done for two reasons: "losing share due to Maintenance Choice and ongoing pharmacy reimbursement pressure." The analysts said, "Among the plan sponsors we have spoken to, some have indicated that the removal of Walgreens from the network would not have a major impact given the availability of other alternatives, while others were more concerned over member disruption. We believe that CVS Caremark could offer better pricing to those customers as a potential enticement to stay." A resolution between CVS and Walgreens is a possibility going forward. According to the analysts, it is too early to tell what financial impact this will have. Their estimates are not being adjusted at this point. The price target remains at $43.00. CVS is currently trading at $31.12. Talk to other investors at