Is this still a safe dividend stock you can buy and hold for the long haul?Shares of CVS Health (CVS -0.83%) have been under pressure this month after the healthcare giant reported uninspiring quarterly results. It also reduced its guidance for the year. With the company facing higher costs and headwinds due to macroeconomic conditions, investors have grown wary of the stock, and its dividend as well. Now yielding around 4.8% per year, is CVS Health's dividend too high and due for a cut?Can CVS Health affor ...

CVS Health Corporation Conference Call Summary Company Overview - **Company**: CVS Health Corporation (NYSE: CVS) - **Event**: BofA Securities 2024 Health Care Conference - **Date**: May 14, 2024 - **Participants**: CFO Thomas Cowhey, Head of IR Larry McGrath, Analyst Allen Lutz Key Points Financial Performance - **First Quarter Results**: Company expressed disappointment with first quarter results, indicating performance was not acceptable and acknowledging the need for improvement in Medicare Advantage [2][3] - **Medicare Advantage**: Company believes it can be a significant business but will take a couple of years to get back on track, starting with 2025 bids [2][3] - **Healthcare Benefits Miss**: Missed healthcare benefits by approximately $900 million due to higher-than-anticipated medical costs, with $400 million attributed to increased utilization in outpatient services and behavioral health [5][6] Business Segments - **Pharmacy and Consumer Wellness**: Strong growth in pharmacy and consumer wellness business, with scripts growing well above market levels [3] - **Health Services Segment**: Experienced timing issues in the first quarter, but the Cordavis and Caremark businesses are expected to recapture lost dollars [19][24] - **Oak Street**: Achieved one of the best years since the pandemic, with consistent performance in line with expectations [20] Future Guidance - **Earnings Guidance**: Projected earnings of $7 per share, with 55% to 60% expected in the back half of the year [15][16] - **Margin Improvement**: Aiming for a margin of 4% to 5% by adjusting benefits and enhancing medical management [9][11] - **Cash Flow**: Projected cash flow from operations over $10.5 billion for the year, with a balanced approach to capital deployment [27] Strategic Initiatives - **CostVantage and TrueCost**: New reimbursement models aimed at improving transparency and addressing reimbursement pressures faced by retail pharmacies [33][34] - **Cordavis Success**: Transition to biosimilars has been successful, with significant savings for clients and high conversion rates [30][31][32] - **Regulatory Compliance**: Company is fully compliant with recent legislation focusing on transparency in the PBM business [39] Challenges and Risks - **Utilization Forecasting**: Difficulty in forecasting utilization trends for 2023 and 2024, with potential impacts from the Inflation Reduction Act [9][40][42] - **Medicare Membership**: Potential loss of up to 10% of existing Medicare members as the company prioritizes margin over membership [14] Legislative Impact - **Inflation Reduction Act**: Anticipated changes to Part D could lead to increased prices and shifted risk to plans, impacting pricing strategies for 2025 [40][42] Additional Insights - **Market Dynamics**: The company is actively engaging with stakeholders to adapt to changing market conditions and regulatory environments [38][39] - **Long-term Strategy**: CVS is focused on sustainable growth through innovative products and strategic partnerships while managing risks associated with healthcare trends and regulations [11][12][32]

Year to date, shares of CVS are now down by nearly 30%.Shares of CVS Health (CVS 0.25%) have been falling sharply this month after investors were unimpressed with the healthcare giant's latest earnings numbers. The sell-off has been so extreme that not only is CVS trading near its 52-week low, but the stock is now at levels it hasn't been at since 2020. It seems to be trading at a high discount, and with the big decline in price, its dividend is now yielding 4.8%, which is far higher than normal.Is the sell ...

Concerns higher than during COVID-19 pandemic, with the effects of social media a driving factorWOONSOCKET, R.I., May 9, 2024 /PRNewswire/ -- A recent CVS Health® (NYSE: CVS)/Morning Consult survey found that a majority of adults have significant concerns about their mental health and rates across the country continue to rise. Image provided by CVS Health Two-thirds (65%) of adults have experienced concerns about their own mental health or the mental health of their friends and family, which is up six ...

When deciding whether to buy, sell, or hold a stock, investors often rely on analyst recommendations. Media reports about rating changes by these brokerage-firm-employed (or sell-side) analysts often influence a stock's price, but are they really important?Before we discuss the reliability of brokerage recommendations and how to use them to your advantage, let's see what these Wall Street heavyweights think about CVS Health (CVS) .CVS Health currently has an average brokerage recommendation (ABR) of 1.98, o ...

The insurance business can be a great way to build wealth over time.Often overlooked in this era where investors are seeking out fast returns, insurance companies just might offer you a decent path to millionaire status over time.Insurance is all about putting a price tag on risk, which makes it one of the most inflation-resilient business out there. After all, as costs go up, so do premiums, even if those premiums remain fairly consistent in terms of the percentage of value of the assets being insured.In a ...

About this content About William Farrington William kickstarted his career as a researcher and reporter for a global legal publication, covering everything from public law to M&A. Before moving to Proactive Investors, he worked as a reporter for a major fintech company with a focus on cryptocurrency and blockchain technology. Harking from Queensland, Australia, William obtained first-class honours in journalism and media from Birkbeck University before going on to complete an MA in creative and critical ...

Key TakeawaysThe S&P 500 fell 0.3% on Wednesday, May 1, 2024, as the Federal Reserve held interest rates steady and Chair Jerome Powell discounted the likelihood of an imminent rate hike.CVS shares plunged after the pharmacy giant missed estimates and cut guidance amid higher health care costs and Medicare reimbursement pressures.Bio-Techne shares soared as the biotech firm posted better-than-expected results, lifted by strength in the diagnostics and genomics segment. Major U.S. equities indexes were mixed ...

The volatile consumer healthcare sector showed up big in CVS’ Q1 earnings Wednesday (May 1), with solid revenue from its store operations but a warning about revenue projections due to its foray into the insurance sector. By the numbers, CVS Health reported first-quarter revenues of approximately $88 billion, marking a 4% increase year-over-year. However, the more concerning figure was the adjusted earnings per share (EPS) of $1.31, well below analysts’ projections of about $1.69, according to the Associate ...

About this content About Emily Jarvie Emily began her career as a political journalist for Australian Community Media in Hobart, Tasmania. After she relocated to Toronto, Canada, she reported on business, legal, and scientific developments in the emerging psychedelics sector before joining Proactive in 2022. She brings a strong journalism background with her work featured in newspapers, magazines, and digital publications across Australia, Europe, and North America, including The Examiner, The Advocate, ...