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CVS Health Posts In-Line Q3 Earnings, But Issues Weak Profit Forecast

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CVS Health Corp (NYSE: CVS) reported in-line earnings for the third quarter, but the company issued a weak earnings forecast for the next year.

The Woonsocket, Rhode Island-based company reported quarterly net earnings of $1.25 billion, or $1.11 per share, compared to $948 million, or $0.81 per share, in the year-ago period. Excluding non-recurring items, the company's adjusted earnings came in at $1.29 per share.

Its revenue climbed to $38.64 billion from $35.02 billion. However, analysts were expecting earnings of $1.29 per share on revenue of $37.9 billion.

The average estimate among 58 Estimize users was for earnings of $1.31 per share and revenue of $37.79 billion.

Revenue in the Pharmacy Services Segment climbed 13.3 percent to $25.5 billion for the quarter, while revenue in the Retail/LTC Segment rose 6.9 percent to $17.9 billion.

Operating profit climbed 3.8 percent to $2.3 billion in the quarter.

During the quarter, CVS opened 43 new retail drugstores and closed 2 retail drugstores.

President and Chief Executive Officer Larry Merlo said, "I'm very pleased to report third quarter results that are at the higher end of our expectations. We delivered solid revenue and operating profit growth across our businesses, and we continue to expect significant growth in the fourth quarter, rounding out another terrific year for our company. Year to date, we generated $3.4 billion of free cash, and we are on pace to return more than $6 billion to our shareholders through dividends and share repurchases in 2015."

The company narrowed its FY15 adjusted earnings forecast to $5.14 to $5.18 per share.

The company projects 2016 adjusted earnings of $5.68 to $5.88 per share, versus analysts' estimates of $6.02 per share.

CVS Health shares fell 0.01 percent to close at $103.80 yesterday.

Posted-In: profitEarnings News Guidance

 

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