CVS HEALTH CORP (CVS) Stock Fundamental Analysis
USA - NYSE:CVS - US1266501006 - Common Stock
74.98 USD
+0.31 (+0.42%)
74.98 USD
0 (0%)
We assign a fundamental rating of 4 out of 10 to CVS. CVS was compared to 101 industry peers in the Health Care Providers & Services industry. CVS has a medium profitability rating, but doesn't score so well on its financial health evaluation. CVS has a bad growth rate and is valued cheaply. CVS also has an excellent dividend rating.
1. Profitability
1.1 Basic Checks
CVS had positive earnings in the past year.
CVS had a positive operating cash flow in the past year.
CVS had positive earnings in each of the past 5 years.
In the past 5 years CVS always reported a positive cash flow from operatings.
1.2 Ratios
The Return On Assets of CVS (1.75%) is comparable to the rest of the industry.
Looking at the Return On Equity, with a value of 5.86%, CVS is in the better half of the industry, outperforming 64.36% of the companies in the same industry.
CVS has a Return On Invested Capital (4.57%) which is in line with its industry peers.
Measured over the past 3 years, the Average Return On Invested Capital for CVS is below the industry average of 9.19%.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 1.75% | ||
| ROE | 5.86% | ||
| ROIC | 4.57% |
ROA(3y)2.35%
ROA(5y)2.72%
ROE(3y)7.68%
ROE(5y)8.81%
ROIC(3y)6.22%
ROIC(5y)6.35%
1.3 Margins
CVS has a Profit Margin (1.17%) which is in line with its industry peers.
CVS's Profit Margin has declined in the last couple of years.
CVS's Operating Margin of 2.65% is in line compared to the rest of the industry. CVS outperforms 52.48% of its industry peers.
CVS's Operating Margin has declined in the last couple of years.
The Gross Margin of CVS (13.82%) is worse than 66.34% of its industry peers.
In the last couple of years the Gross Margin of CVS has declined.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 2.65% | ||
| PM (TTM) | 1.17% | ||
| GM | 13.82% |
OM growth 3Y-19.77%
OM growth 5Y-11.12%
PM growth 3Y-23.26%
PM growth 5Y-13.69%
GM growth 3Y-8.24%
GM growth 5Y-18.43%
2. Health
2.1 Basic Checks
CVS has a Return on Invested Capital (ROIC), which is below the Cost of Capital (WACC), which means it is destroying value.
The number of shares outstanding for CVS has been reduced compared to 1 year ago.
Compared to 5 years ago, CVS has less shares outstanding
Compared to 1 year ago, CVS has a worse debt to assets ratio.
2.2 Solvency
An Altman-Z score of 2.20 indicates that CVS is not a great score, but indicates only limited risk for bankruptcy at the moment.
CVS has a Altman-Z score (2.20) which is comparable to the rest of the industry.
CVS has a debt to FCF ratio of 13.91. This is a negative value and a sign of low solvency as CVS would need 13.91 years to pay back of all of its debts.
CVS's Debt to FCF ratio of 13.91 is in line compared to the rest of the industry. CVS outperforms 44.55% of its industry peers.
A Debt/Equity ratio of 0.78 indicates that CVS is somewhat dependend on debt financing.
CVS's Debt to Equity ratio of 0.78 is in line compared to the rest of the industry. CVS outperforms 43.56% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.78 | ||
| Debt/FCF | 13.91 | ||
| Altman-Z | 2.2 |
ROIC/WACC0.58
WACC7.89%
2.3 Liquidity
A Current Ratio of 0.80 indicates that CVS may have some problems paying its short term obligations.
Looking at the Current ratio, with a value of 0.80, CVS is doing worse than 84.16% of the companies in the same industry.
CVS has a Quick Ratio of 0.80. This is a bad value and indicates that CVS is not financially healthy enough and could expect problems in meeting its short term obligations.
With a Quick ratio value of 0.62, CVS is not doing good in the industry: 85.15% of the companies in the same industry are doing better.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 0.8 | ||
| Quick Ratio | 0.62 |
3. Growth
3.1 Past
CVS shows a strong negative growth in Earnings Per Share. In the last year the EPS decreased by -15.13%.
Measured over the past years, CVS shows a decrease in Earnings Per Share. The EPS has been decreasing by -5.20% on average per year.
CVS shows a small growth in Revenue. In the last year, the Revenue has grown by 6.44%.
CVS shows a small growth in Revenue. Measured over the last years, the Revenue has been growing by 7.74% yearly.
EPS 1Y (TTM)-15.13%
EPS 3Y-13.62%
EPS 5Y-5.2%
EPS Q2Q%-1.09%
Revenue 1Y (TTM)6.44%
Revenue growth 3Y8.47%
Revenue growth 5Y7.74%
Sales Q2Q%8.42%
3.2 Future
Based on estimates for the next years, CVS will show a quite strong growth in Earnings Per Share. The EPS will grow by 10.99% on average per year.
CVS is expected to show a small growth in Revenue. In the coming years, the Revenue will grow by 4.84% yearly.
EPS Next Y18.42%
EPS Next 2Y15.4%
EPS Next 3Y14.5%
EPS Next 5Y10.99%
Revenue Next Year5.85%
Revenue Next 2Y5.12%
Revenue Next 3Y5.31%
Revenue Next 5Y4.84%
3.3 Evolution
The EPS growth rate is accelerating: in the next years the growth will be better than in the last years.
The Revenue growth rate is decreasing: in the next years the growth will be less than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
The Price/Earnings ratio is 11.83, which indicates a very decent valuation of CVS.
Based on the Price/Earnings ratio, CVS is valued cheaply inside the industry as 87.13% of the companies are valued more expensively.
CVS's Price/Earnings ratio indicates a rather cheap valuation when compared to the S&P500 average which is at 27.30.
A Price/Forward Earnings ratio of 10.39 indicates a reasonable valuation of CVS.
83.17% of the companies in the same industry are more expensive than CVS, based on the Price/Forward Earnings ratio.
CVS's Price/Forward Earnings ratio indicates a rather cheap valuation when compared to the S&P500 average which is at 22.73.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 11.83 | ||
| Fwd PE | 10.39 |
4.2 Price Multiples
Compared to the rest of the industry, the Price/Free Cash Flow ratio of CVS indicates a somewhat cheap valuation: CVS is cheaper than 64.36% of the companies listed in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 19.9 | ||
| EV/EBITDA | N/A |
4.3 Compensation for Growth
CVS's low PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a rather cheap valuation of the company.
A more expensive valuation may be justified as CVS's earnings are expected to grow with 14.50% in the coming years.
PEG (NY)0.64
PEG (5Y)N/A
EPS Next 2Y15.4%
EPS Next 3Y14.5%
5. Dividend
5.1 Amount
CVS has a Yearly Dividend Yield of 3.56%. Purely for dividend investing, there may be better candidates out there.
CVS's Dividend Yield is rather good when compared to the industry average which is at 2.43. CVS pays more dividend than 98.02% of the companies in the same industry.
Compared to an average S&P500 Dividend Yield of 2.38, CVS pays a bit more dividend than the S&P500 average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 3.56% |
5.2 History
The dividend of CVS has a limited annual growth rate of 5.72%.
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)5.72%
Div Incr Years3
Div Non Decr Years28
5.3 Sustainability
CVS pays out 74.62% of its income as dividend. This is not a sustainable payout ratio.
The dividend of CVS is growing, but earnings are growing more, so the dividend growth is sustainable.
DP74.62%
EPS Next 2Y15.4%
EPS Next 3Y14.5%
74.98
+0.31 (+0.42%)
Chartmill FA Rating
GICS SectorHealth Care
GICS IndustryGroupHealth Care Equipment & Services
GICS IndustryHealth Care Providers & Services
Earnings (Last)
Earnings (Next)
Inst Owners87.14%
Inst Owner Change-0.54%
Ins Owners0.99%
Ins Owner Change6.3%
Market Cap95.10B
Analysts79.39
Price Target82.25 (9.7%)
Short Float %1.33%
Short Ratio2.19
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 3.56% |
Yearly Dividend2.65
Dividend Growth(5Y)5.72%
DP74.62%
Div Incr Years3
Div Non Decr Years28
Ex-Date
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)26.87%
Min EPS beat(2)22.99%
Max EPS beat(2)30.76%
EPS beat(4)3
Avg EPS beat(4)13.15%
Min EPS beat(4)-28.4%
Max EPS beat(4)30.76%
EPS beat(8)6
Avg EPS beat(8)5.23%
EPS beat(12)10
Avg EPS beat(12)4.69%
EPS beat(16)14
Avg EPS beat(16)4.93%
Revenue beat(2)2
Avg Revenue beat(2)1.83%
Min Revenue beat(2)0.02%
Max Revenue beat(2)3.64%
Revenue beat(4)3
Avg Revenue beat(4)1.27%
Min Revenue beat(4)-0.46%
Max Revenue beat(4)3.64%
Revenue beat(8)5
Avg Revenue beat(8)0.67%
Revenue beat(12)9
Avg Revenue beat(12)2.1%
Revenue beat(16)13
Avg Revenue beat(16)2.16%
PT rev (1m)2.16%
PT rev (3m)2.49%
EPS NQ rev (1m)-1.98%
EPS NQ rev (3m)-5.25%
EPS NY rev (1m)3.6%
EPS NY rev (3m)4.02%
Revenue NQ rev (1m)0.29%
Revenue NQ rev (3m)1.04%
Revenue NY rev (1m)1.74%
Revenue NY rev (3m)1.64%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 11.83 | ||
| Fwd PE | 10.39 | ||
| P/S | 0.25 | ||
| P/FCF | 19.9 | ||
| P/OCF | 12.57 | ||
| P/B | 1.23 | ||
| P/tB | N/A | ||
| EV/EBITDA | N/A |
EPS(TTM)6.34
EY8.46%
EPS(NY)7.22
Fwd EY9.63%
FCF(TTM)3.77
FCFY5.03%
OCF(TTM)5.97
OCFY7.96%
SpS304.84
BVpS61.01
TBVpS-31.58
PEG (NY)0.64
PEG (5Y)N/A
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 1.75% | ||
| ROE | 5.86% | ||
| ROCE | 6.23% | ||
| ROIC | 4.57% | ||
| ROICexc | 5% | ||
| ROICexgc | 21.47% | ||
| OM | 2.65% | ||
| PM (TTM) | 1.17% | ||
| GM | 13.82% | ||
| FCFM | 1.24% |
ROA(3y)2.35%
ROA(5y)2.72%
ROE(3y)7.68%
ROE(5y)8.81%
ROIC(3y)6.22%
ROIC(5y)6.35%
ROICexc(3y)6.76%
ROICexc(5y)6.87%
ROICexgc(3y)25.87%
ROICexgc(5y)25.07%
ROCE(3y)8.35%
ROCE(5y)8.51%
ROICexcg growth 3Y-10.65%
ROICexcg growth 5Y-1.15%
ROICexc growth 3Y-14.28%
ROICexc growth 5Y-4.08%
OM growth 3Y-19.77%
OM growth 5Y-11.12%
PM growth 3Y-23.26%
PM growth 5Y-13.69%
GM growth 3Y-8.24%
GM growth 5Y-18.43%
F-Score5
Asset Turnover1.5
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.78 | ||
| Debt/FCF | 13.91 | ||
| Debt/EBITDA | N/A | ||
| Cap/Depr | N/A | ||
| Cap/Sales | 0.72% | ||
| Interest Coverage | -3.41 | ||
| Cash Conversion | N/A | ||
| Profit Quality | 105.5% | ||
| Current Ratio | 0.8 | ||
| Quick Ratio | 0.62 | ||
| Altman-Z | 2.2 |
F-Score5
WACC7.89%
ROIC/WACC0.58
Cap/Depr(3y)N/A
Cap/Depr(5y)N/A
Cap/Sales(3y)0.81%
Cap/Sales(5y)0.84%
Profit Quality(3y)191.23%
Profit Quality(5y)191.5%
High Growth Momentum
Growth
EPS 1Y (TTM)-15.13%
EPS 3Y-13.62%
EPS 5Y-5.2%
EPS Q2Q%-1.09%
EPS Next Y18.42%
EPS Next 2Y15.4%
EPS Next 3Y14.5%
EPS Next 5Y10.99%
Revenue 1Y (TTM)6.44%
Revenue growth 3Y8.47%
Revenue growth 5Y7.74%
Sales Q2Q%8.42%
Revenue Next Year5.85%
Revenue Next 2Y5.12%
Revenue Next 3Y5.31%
Revenue Next 5Y4.84%
EBIT growth 1Y-20.52%
EBIT growth 3Y-12.98%
EBIT growth 5Y-4.24%
EBIT Next Year42.57%
EBIT Next 3Y19.26%
EBIT Next 5Y18.23%
FCF growth 1Y-72.95%
FCF growth 3Y-26.21%
FCF growth 5Y-9.45%
OCF growth 1Y-63.11%
OCF growth 3Y-20.7%
OCF growth 5Y-6.65%