CVS HEALTH CORP (CVS) Stock Fundamental Analysis
USA - New York Stock Exchange - NYSE:CVS - US1266501006 - Common Stock
79.61 USD
+0.49 (+0.62%)
79.61 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 bad profitability rating. Also its financial health evaluation is rather negative. CVS may be a bit undervalued, certainly considering the very reasonable score on growth 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.
In the past 5 years CVS has always been profitable.
CVS had a positive operating cash flow in each of the past 5 years.
1.2 Ratios
The Return On Assets of CVS (0.18%) is comparable to the rest of the industry.
Looking at the Return On Equity, with a value of 0.64%, CVS is in line with its industry, outperforming 53.92% of the companies in the same industry.
With a Return On Invested Capital value of 4.90%, CVS perfoms like the industry average, outperforming 56.86% of the companies in the same industry.
Measured over the past 3 years, the Average Return On Invested Capital for CVS is below the industry average of 9.58%.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 0.18% | ||
| ROE | 0.64% | ||
| ROIC | 4.9% |
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
The Profit Margin of CVS (0.12%) is comparable to the rest of the industry.
In the last couple of years the Profit Margin of CVS has declined.
Looking at the Operating Margin, with a value of 2.73%, CVS is in line with its industry, outperforming 53.92% of the companies in the same industry.
In the last couple of years the Operating Margin of CVS has declined.
CVS's Gross Margin of 13.88% is on the low side compared to the rest of the industry. CVS is outperformed by 68.63% of its industry peers.
In the last couple of years the Gross Margin of CVS has declined.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 2.73% | ||
| PM (TTM) | 0.12% | ||
| GM | 13.88% |
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-4.91%
2. Health
2.1 Basic Checks
With a Return on Invested Capital (ROIC) below the Cost of Capital (WACC), CVS is destroying value.
The number of shares outstanding for CVS has been reduced compared to 1 year ago.
The number of shares outstanding for CVS has been reduced compared to 5 years ago.
Compared to 1 year ago, CVS has a worse debt to assets ratio.
2.2 Solvency
CVS has an Altman-Z score of 2.27. 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.
CVS has a Altman-Z score (2.27) which is comparable to the rest of the industry.
The Debt to FCF ratio of CVS is 10.46, which is on the high side as it means it would take CVS, 10.46 years of fcf income to pay off all of its debts.
CVS's Debt to FCF ratio of 10.46 is in line compared to the rest of the industry. CVS outperforms 44.12% of its industry peers.
CVS has a Debt/Equity ratio of 0.85. This is a neutral value indicating CVS is somewhat dependend on debt financing.
CVS has a Debt to Equity ratio (0.85) which is comparable to the rest of the industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.85 | ||
| Debt/FCF | 10.46 | ||
| Altman-Z | 2.27 |
ROIC/WACC0.6
WACC8.12%
2.3 Liquidity
A Current Ratio of 0.83 indicates that CVS may have some problems paying its short term obligations.
CVS's Current ratio of 0.83 is on the low side compared to the rest of the industry. CVS is outperformed by 82.35% of its industry peers.
CVS has a Quick Ratio of 0.83. 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 Quick ratio of 0.63. This is amonst the worse of the industry: CVS underperforms 81.37% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 0.83 | ||
| Quick Ratio | 0.63 |
3. Growth
3.1 Past
The Earnings Per Share has been growing slightly by 7.87% over the past year.
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 6.82%.
CVS shows a small growth in Revenue. Measured over the last years, the Revenue has been growing by 7.74% yearly.
EPS 1Y (TTM)7.87%
EPS 3Y-13.62%
EPS 5Y-5.2%
EPS Q2Q%46.79%
Revenue 1Y (TTM)6.82%
Revenue growth 3Y8.47%
Revenue growth 5Y7.74%
Sales Q2Q%7.8%
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 12.34% on average per year.
The Revenue is expected to grow by 5.00% on average over the next years.
EPS Next Y23.97%
EPS Next 2Y15.58%
EPS Next 3Y15.14%
EPS Next 5Y12.34%
Revenue Next Year7.57%
Revenue Next 2Y5.14%
Revenue Next 3Y5.22%
Revenue Next 5Y5%
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.
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
Based on the Price/Earnings ratio of 11.62, the valuation of CVS can be described as reasonable.
Based on the Price/Earnings ratio, CVS is valued cheaply inside the industry as 85.29% of the companies are valued more expensively.
CVS is valuated cheaply when we compare the Price/Earnings ratio to 26.92, which is the current average of the S&P500 Index.
Based on the Price/Forward Earnings ratio of 11.00, the valuation of CVS can be described as reasonable.
Based on the Price/Forward Earnings ratio, CVS is valued cheaper than 87.25% of the companies in the same industry.
The average S&P500 Price/Forward Earnings ratio is at 23.46. CVS is valued rather cheaply when compared to this.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 11.62 | ||
| Fwd PE | 11 |
4.2 Price Multiples
73.53% of the companies in the same industry are more expensive than CVS, based on the Price/Free Cash Flow ratio.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 16.06 | ||
| 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 15.14% in the coming years.
PEG (NY)0.48
PEG (5Y)N/A
EPS Next 2Y15.58%
EPS Next 3Y15.14%
5. Dividend
5.1 Amount
CVS has a Yearly Dividend Yield of 3.36%.
Compared to an average industry Dividend Yield of 0.60, CVS pays a better dividend. On top of this CVS pays more dividend than 97.06% of the companies listed in the same industry.
CVS's Dividend Yield is rather good when compared to the S&P500 average which is at 2.00.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 3.36% |
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 722.81% of its income as dividend. This is not a sustainable payout ratio.
CVS's earnings are growing more than its dividend. This makes the dividend growth sustainable.
DP722.81%
EPS Next 2Y15.58%
EPS Next 3Y15.14%
79.61
+0.49 (+0.62%)
Chartmill FA Rating
GICS SectorHealth Care
GICS IndustryGroupHealth Care Equipment & Services
GICS IndustryHealth Care Providers & Services
Earnings (Last)
Earnings (Next)
Inst Owners89.68%
Inst Owner Change2.38%
Ins Owners0.99%
Ins Owner Change-1.12%
Market Cap101.06B
Revenue(TTM)394.08B
Net Income(TTM)469.00M
Analysts80.61
Price Target95.5 (19.96%)
Short Float %1.56%
Short Ratio2.55
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 3.36% |
Yearly Dividend2.65
Dividend Growth(5Y)5.72%
DP722.81%
Div Incr Years3
Div Non Decr Years28
Ex-Date
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)19.34%
Min EPS beat(2)15.69%
Max EPS beat(2)22.99%
EPS beat(4)4
Avg EPS beat(4)24.17%
Min EPS beat(4)15.69%
Max EPS beat(4)30.76%
EPS beat(8)6
Avg EPS beat(8)6.87%
EPS beat(12)10
Avg EPS beat(12)5.67%
EPS beat(16)14
Avg EPS beat(16)5.3%
Revenue beat(2)2
Avg Revenue beat(2)3.34%
Min Revenue beat(2)3.04%
Max Revenue beat(2)3.64%
Revenue beat(4)3
Avg Revenue beat(4)1.56%
Min Revenue beat(4)-0.46%
Max Revenue beat(4)3.64%
Revenue beat(8)5
Avg Revenue beat(8)0.97%
Revenue beat(12)9
Avg Revenue beat(12)1.97%
Revenue beat(16)13
Avg Revenue beat(16)2.12%
PT rev (1m)3.28%
PT rev (3m)16.12%
EPS NQ rev (1m)3.07%
EPS NQ rev (3m)5.61%
EPS NY rev (1m)1.97%
EPS NY rev (3m)4.53%
Revenue NQ rev (1m)1.11%
Revenue NQ rev (3m)2.37%
Revenue NY rev (1m)0.51%
Revenue NY rev (3m)1.63%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 11.62 | ||
| Fwd PE | 11 | ||
| P/S | 0.26 | ||
| P/FCF | 16.06 | ||
| P/OCF | 11.09 | ||
| P/B | 1.39 | ||
| P/tB | N/A | ||
| EV/EBITDA | N/A |
EPS(TTM)6.85
EY8.6%
EPS(NY)7.24
Fwd EY9.09%
FCF(TTM)4.96
FCFY6.23%
OCF(TTM)7.18
OCFY9.01%
SpS310.44
BVpS57.45
TBVpS-30.36
PEG (NY)0.48
PEG (5Y)N/A
Graham Number94.1
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 0.18% | ||
| ROE | 0.64% | ||
| ROCE | 6.61% | ||
| ROIC | 4.9% | ||
| ROICexc | 5.26% | ||
| ROICexgc | 19.51% | ||
| OM | 2.73% | ||
| PM (TTM) | 0.12% | ||
| GM | 13.88% | ||
| FCFM | 1.6% |
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%
ROICexgc growth 3Y-10.65%
ROICexgc 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-4.91%
F-Score6
Asset Turnover1.54
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.85 | ||
| Debt/FCF | 10.46 | ||
| Debt/EBITDA | N/A | ||
| Cap/Depr | N/A | ||
| Cap/Sales | 0.71% | ||
| Interest Coverage | -3.53 | ||
| Cash Conversion | N/A | ||
| Profit Quality | 1341.79% | ||
| Current Ratio | 0.83 | ||
| Quick Ratio | 0.63 | ||
| Altman-Z | 2.27 |
F-Score6
WACC8.12%
ROIC/WACC0.6
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)7.87%
EPS 3Y-13.62%
EPS 5Y-5.2%
EPS Q2Q%46.79%
EPS Next Y23.97%
EPS Next 2Y15.58%
EPS Next 3Y15.14%
EPS Next 5Y12.34%
Revenue 1Y (TTM)6.82%
Revenue growth 3Y8.47%
Revenue growth 5Y7.74%
Sales Q2Q%7.8%
Revenue Next Year7.57%
Revenue Next 2Y5.14%
Revenue Next 3Y5.22%
Revenue Next 5Y5%
EBIT growth 1Y-3.81%
EBIT growth 3Y-12.98%
EBIT growth 5Y-4.24%
EBIT Next Year46.72%
EBIT Next 3Y19.51%
EBIT Next 5Y17.54%
FCF growth 1Y-44.32%
FCF growth 3Y-26.21%
FCF growth 5Y-9.45%
OCF growth 1Y-35.44%
OCF growth 3Y-20.7%
OCF growth 5Y-6.65%
CVS HEALTH CORP / CVS FAQ
What is the fundamental rating for CVS stock?
ChartMill assigns a fundamental rating of 4 / 10 to CVS.
What is the valuation status for CVS stock?
ChartMill assigns a valuation rating of 7 / 10 to CVS HEALTH CORP (CVS). This can be considered as Undervalued.
What is the profitability of CVS stock?
CVS HEALTH CORP (CVS) has a profitability rating of 3 / 10.
What are the PE and PB ratios of CVS HEALTH CORP (CVS) stock?
The Price/Earnings (PE) ratio for CVS HEALTH CORP (CVS) is 11.62 and the Price/Book (PB) ratio is 1.39.
Is the dividend of CVS HEALTH CORP sustainable?
The dividend rating of CVS HEALTH CORP (CVS) is 7 / 10 and the dividend payout ratio is 722.81%.