Analysts rate CVS Health Corp. (CVS:NYE) with a Strong Buy rating and a $119 target

STA Research
by: STA Research
CVS Health Corp

Based on the CVS stock forecast from 7 analysts, the average analyst CVS stock price target is USD 119.40 over the next 12 months. CVS Health Corp’s average analyst rating is Strong Buy. Stock Target Advisor’s own stock analysis of CVS stock forecast is Neutral, which is based on 8 positive signals and 7 negative signals. At the last closing, CVS stock price was USD 99.44CVS stock price has changed by -0.62% over the past week, +4.07% over the past month and +13.68% over the last year.

About CVS Health Corp. (CVS:NYE):

CVS Health Corporation provides health services in the United States. The company’s Health Care Benefits segment offers traditional, voluntary, and consumer-directed health insurance products and related services. It serves employer groups, individuals, college students, part-time and hourly workers, health plans, health care providers, governmental units, government-sponsored plans, labor groups, and expatriates. Its Pharmacy Services segment offers pharmacy benefit management solutions The company was formerly known as CVS Caremark Corporation and changed its name to CVS Health Corporation in September 2014. CVS Health Corporation was founded in 1963 and is headquartered in Woonsocket, Rhode Island.

 

What we like:

High market capitalization:

This is one of the largest entities in its sector and is among the top quartile. Such companies tend to be more stable.

Superior total returns:

The stock has outperformed its sector peers on average annual total returns basis in the past 5 years (for a hold period of at least 12 months) and is in the top quartile.

Underpriced compared to earnings:

CVS stock target price is trading low compared to its peers on a price to earning basis and is in the top quartile. It may be underpriced but do check its financial performance to make sure there is no specific reason.

Underpriced compared to book value:

CVS stock target price is trading low compared to its peers on a price to book value basis and is in the top quartile. It may be underpriced but do check its financial performance to make sure there is no specific reason.

Underpriced on cashflow basis:

CVS stock target price is trading low compared to its peers on a price to cash flow basis and is in the top quartile. It may be underpriced but do check its financial performance to make sure there is no specific reason.

Positive cash flow:

The company had positive total cash flow in the most recent four quarters.

Positive free cash flow:

The company had positive total free cash flow in the most recent four quarters.

Underpriced on free cash flow basis:

CVS stock target price is trading low compared to its peers on a price to free cash flow basis and is in the top quartile. It may be underpriced but do check its financial performance to make sure there is no specific reason.

 

What we don’t like:

Poor risk adjusted returns:

This company is delivering below median risk adjusted returns in its peers. Even if it is outperforming on returns, the returns are unpredictable. Proceed with caution.

Below median dividend returns:

The company’s average income yield over the past 5 years has been low compared to its peers. However, it is not a problem if you are not looking for income.

Poor return on equity:

The company management has delivered below median return on equity in the most recent 4 quarters compared to its peers.

Highly leveraged:

The company is in the bottom half compared to its sector peers on debt to equity and is highly leveraged. However, do check the CVS stock forecast and look at its sector and management statements. Sometimes this is high because the company is trying to grow aggressively.

Overpriced on free cash flow basis:

CVS stock price is trading high compared to its peers on a price to free cash flow basis. It is priced above the median for its sectors. Proceed with caution if you are considering to buy.

Low Earnings Growth:

This stock has shown below median earnings growth in the previous 5 years compared to its sector

Low Dividend Growth:

This stock has shown below median dividend growth in the previous 5 years compared to its sector.

Disclaimer

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