CVS HEALTH CORP (CVS)
US1266501006 - Common Stock
Taking everything into account, CVS scores 5 out of 10 in our fundamental rating. CVS was compared to 116 industry peers in the Health Care Providers & Services industry. While CVS is still in line with the averages on profitability rating, there are concerns on its financial health. CVS has a correct valuation and a medium growth rate. CVS also has an excellent dividend rating.
1. Profitability
1.1 Basic Checks
In the past year CVS was profitable.
In the past year CVS had a positive cash flow from operations.
CVS had positive earnings in each of the past 5 years.
CVS had a positive operating cash flow in each of the past 5 years.
1.2 Ratios
With a decent Return On Assets value of 3.34%, CVS is doing good in the industry, outperforming 72.41% of the companies in the same industry.
CVS has a Return On Equity of 10.91%. This is in the better half of the industry: CVS outperforms 76.72% of its industry peers.
With a decent Return On Invested Capital value of 6.58%, CVS is doing good in the industry, outperforming 71.55% of the companies in the same industry.
CVS had an Average Return On Invested Capital over the past 3 years of 7.03%. This is in line with the industry average of 8.64%.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 3.34% | ||
| ROE | 10.91% | ||
| ROIC | 6.58% |
ROA(3y)2.89%
ROA(5y)2.95%
ROE(3y)9.2%
ROE(5y)9.67%
ROIC(3y)7.03%
ROIC(5y)6.55%
1.3 Margins
CVS has a Profit Margin of 2.33%. This is in the better half of the industry: CVS outperforms 67.24% of its industry peers.
CVS's Profit Margin has declined in the last couple of years.
CVS has a better Operating Margin (4.22%) than 60.34% of its industry peers.
In the last couple of years the Operating Margin of CVS has declined.
CVS's Gross Margin of 15.21% is on the low side compared to the rest of the industry. CVS is outperformed by 73.28% of its industry peers.
In the last couple of years the Gross Margin of CVS has declined.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 4.22% | ||
| PM (TTM) | 2.33% | ||
| GM | 15.21% |
OM growth 3Y-6.75%
OM growth 5Y-4.2%
PM growth 3Y-4.43%
PM growth 5YN/A
GM growth 3Y-26.92%
GM growth 5Y-4.94%
2. Health
2.1 Basic Checks
With a Return on Invested Capital (ROIC) just above the Cost of Capital (WACC), CVS is creating some value.
The number of shares outstanding for CVS has been reduced compared to 1 year ago.
CVS has less shares outstanding than it did 5 years ago.
CVS has a worse debt/assets ratio than last year.
2.2 Solvency
CVS has an Altman-Z score of 2.22. This is not the best score and indicates that CVS is in the grey zone with still only limited risk for bankruptcy at the moment.
Looking at the Altman-Z score, with a value of 2.22, CVS is in line with its industry, outperforming 59.48% of the companies in the same industry.
CVS has a debt to FCF ratio of 5.93. This is a neutral value as CVS would need 5.93 years to pay back of all of its debts.
With a decent Debt to FCF ratio value of 5.93, CVS is doing good in the industry, outperforming 67.24% of the companies in the same industry.
CVS has a Debt/Equity ratio of 0.77. This is a neutral value indicating CVS is somewhat dependend on debt financing.
With a Debt to Equity ratio value of 0.77, CVS perfoms like the industry average, outperforming 44.83% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.77 | ||
| Debt/FCF | 5.93 | ||
| Altman-Z | 2.22 |
ROIC/WACC0.94
WACC6.98%
2.3 Liquidity
CVS has a Current Ratio of 0.86. This is a bad value and indicates that CVS is not financially healthy enough and could expect problems in meeting its short term obligations.
CVS has a worse Current ratio (0.86) than 76.72% of its industry peers.
A Quick Ratio of 0.63 indicates that CVS may have some problems paying its short term obligations.
The Quick ratio of CVS (0.63) is worse than 81.90% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 0.86 | ||
| Quick Ratio | 0.63 |
3. Growth
3.1 Past
CVS shows a small growth in Earnings Per Share. In the last year, the EPS has grown by 0.46%.
The Earnings Per Share has been growing slightly by 4.42% on average over the past years.
CVS shows quite a strong growth in Revenue. In the last year, the Revenue has grown by 10.95%.
Measured over the past years, CVS shows a quite strong growth in Revenue. The Revenue has been growing by 12.95% on average per year.
EPS 1Y (TTM)0.46%
EPS 3Y5.19%
EPS 5Y4.42%
EPS growth Q2Q6.53%
Revenue 1Y (TTM)10.95%
Revenue growth 3Y10.01%
Revenue growth 5Y12.95%
Revenue growth Q2Q11.89%
3.2 Future
CVS is expected to show a small growth in Earnings Per Share. In the coming years, the EPS will grow by 6.04% yearly.
The Revenue is expected to grow by 4.83% on average over the next years.
EPS Next Y-4.03%
EPS Next 2Y3.06%
EPS Next 3Y5.28%
EPS Next 5Y6.04%
Revenue Next Year4.64%
Revenue Next 2Y5.28%
Revenue Next 3Y5.68%
Revenue Next 5Y4.83%
3.3 Evolution
When comparing the EPS growth rate of the last years to the growth rate of the upcoming years, we see that the growth is accelerating.
When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is decreasing.
4. Valuation
4.1 Price/Earnings Ratio
CVS is valuated cheaply with a Price/Earnings ratio of 7.85.
CVS's Price/Earnings ratio is rather cheap when compared to the industry. CVS is cheaper than 94.83% of the companies in the same industry.
When comparing the Price/Earnings ratio of CVS to the average of the S&P500 Index (24.83), we can say CVS is valued rather cheaply.
Based on the Price/Forward Earnings ratio of 8.18, the valuation of CVS can be described as reasonable.
96.55% of the companies in the same industry are more expensive than CVS, based on the Price/Forward Earnings ratio.
Compared to an average S&P500 Price/Forward Earnings ratio of 21.32, CVS is valued rather cheaply.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 7.85 | ||
| Fwd PE | 8.18 |
4.2 Price Multiples
Based on the Price/Free Cash Flow ratio, CVS is valued cheaply inside the industry as 88.79% of the companies are valued more expensively.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 8.3 | ||
| EV/EBITDA | N/A |
4.3 Compensation for Growth
PEG (NY)N/A
PEG (5Y)1.78
EPS Next 2Y3.06%
EPS Next 3Y5.28%
5. Dividend
5.1 Amount
With a Yearly Dividend Yield of 3.81%, CVS has a reasonable but not impressive dividend return.
Compared to an average industry Dividend Yield of 2.69, CVS pays a better dividend. On top of this CVS pays more dividend than 95.69% of the companies listed in the same industry.
Compared to an average S&P500 Dividend Yield of 2.39, CVS pays a better dividend.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 3.81% |
5.2 History
The dividend of CVS is nicely growing with an annual growth rate of 6.52%!
CVS has paid a dividend for at least 10 years, which is a reliable track record.
CVS has not decreased their dividend for at least 10 years, which is a reliable track record.
Dividend Growth(5Y)6.52%
Div Incr Years2
Div Non Decr Years17
5.3 Sustainability
CVS pays out 37.54% of its income as dividend. This is a sustainable payout ratio.
CVS's earnings are growing slower than its dividend. This means the dividend growth is not sustainable.
DP37.54%
EPS Next 2Y3.06%
EPS Next 3Y5.28%
CVS HEALTH CORP
NYSE:CVS (4/17/2024, 7:04:00 PM)
Premarket: 68.8 +0.2 (+0.29%)68.6
-0.43 (-0.62%)
Chartmill FA Rating
GICS SectorHealth Care
GICS IndustryGroupHealth Care Equipment & Services
GICS IndustryHealth Care Providers & Services
Earnings (Last)
Earnings (Next)
Inst Owners
Inst Owner Change
Ins Owners
Ins Owner Change
Market Cap86.33B
Analysts
Price Target
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 3.81% |
Dividend Growth(5Y)
DP
Div Incr Years
Div Non Decr Years
Ex-Date
Surprises & Revisions
EPS beat(2)
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EPS NQ rev (1m)
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EPS NY rev (1m)
EPS NY rev (3m)
Revenue NQ rev (1m)
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Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 7.85 | ||
| Fwd PE | 8.18 | ||
| P/S | |||
| P/FCF | |||
| P/OCF | |||
| P/B | |||
| P/tB | |||
| EV/EBITDA |
EPS(TTM)
EY
EPS(NY)
Fwd EY
FCF(TTM)
FCFY
OCF(TTM)
OCFY
SpS
BVpS
TBVpS
PEG (NY)N/A
PEG (5Y)1.78
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 3.34% | ||
| ROE | 10.91% | ||
| ROCE | |||
| ROIC | |||
| ROICexc | |||
| ROICexgc | |||
| OM | 4.22% | ||
| PM (TTM) | 2.33% | ||
| GM | 15.21% | ||
| FCFM |
ROA(3y)
ROA(5y)
ROE(3y)
ROE(5y)
ROIC(3y)
ROIC(5y)
ROICexc(3y)
ROICexc(5y)
ROICexgc(3y)
ROICexgc(5y)
ROCE(3y)
ROCE(5y)
ROICexcg growth 3Y
ROICexcg growth 5Y
ROICexc growth 3Y
ROICexc growth 5Y
OM growth 3Y
OM growth 5Y
PM growth 3Y
PM growth 5Y
GM growth 3Y
GM growth 5Y
F-Score
Asset Turnover1.43
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.77 | ||
| Debt/FCF | |||
| Debt/EBITDA | |||
| Cap/Depr | |||
| Cap/Sales | |||
| Interest Coverage | |||
| Cash Conversion | |||
| Profit Quality | |||
| Current Ratio | 0.86 | ||
| Quick Ratio | 0.63 | ||
| Altman-Z |
F-Score
WACC
ROIC/WACC
Cap/Depr(3y)
Cap/Depr(5y)
Cap/Sales(3y)
Cap/Sales(5y)
Profit Quality(3y)
Profit Quality(5y)
Growth
EPS 1Y (TTM)0.46%
EPS 3Y5.19%
EPS 5Y
EPS growth Q2Q
EPS Next Y-4.03%
EPS Next 2Y
EPS Next 3Y
EPS Next 5Y
Revenue 1Y (TTM)10.95%
Revenue growth 3Y10.01%
Revenue growth 5Y
Revenue growth Q2Q
Revenue Next Year
Revenue Next 2Y
Revenue Next 3Y
Revenue Next 5Y
EBIT growth 1Y
EBIT growth 3Y
EBIT growth 5Y
EBIT Next Year
EBIT Next 3Y
EBIT Next 5Y
FCF growth 1Y
FCF growth 3Y
FCF growth 5Y
OCF growth 1Y
OCF growth 3Y
OCF growth 5Y