CVS Health(US:CVS) ZACKSยท2025-08-22 13:40Core Insights - CVS Health's Pharmacy & Consumer Wellness (PCW) unit has faced challenges due to pharmacy reimbursement pressures but reported a 12% year-over-year revenue increase in Q2 2025, with same-store sales up over 15% and prescription volumes rising nearly 7% [2][8] Group 1: Financial Performance - PCW revenues grew 12% year over year in Q2 2025, with same-store sales up more than 15% [8] - Same-store prescription volumes increased nearly 7%, attributed to investments in technology and staffing [2][8] - CVS Health shares have risen 59.1% year to date, significantly outperforming the industry's 0.2% growth [7] Group 2: Strategic Initiatives - CVS is advancing a new reimbursement model to reduce reliance on cross-subsidization, allowing for better pricing and contract alignment with market conditions [3] - The company is shifting its government business to cost-based pricing models for 2026 [4] Group 3: Competitive Landscape - Elevance Health and NACHC are integrating Food as Medicine programming with primary care Community Health Centers to address food insecurity and diet-related chronic conditions [5] - Kroger Co. reported a 3.2% growth in identical sales without fuel, driven by strong pharmacy and e-commerce performance [6] Group 4: Valuation and Estimates - CVS shares are trading at a forward three-year price-to-sales ratio of 0.23, below the industry average of 0.41, with a Value Score of A [9] - The consensus estimate for CVS's 2025 earnings shows a bullish trend [10]