CVS Health(US:CVS) ZACKS·2025-11-28 17:32Core Insights - CVS Health reported strong Q3 2025 earnings, with adjusted EPS of $1.60, a 46.8% increase year over year, surpassing estimates by 17.65% [2] - Total revenues for Q3 reached $102.87 billion, reflecting a 7.8% year-over-year growth and exceeding consensus estimates by 4.66% [3] Revenue Breakdown - Health Services revenues increased by 11.6% year over year to $49.27 billion, driven by pharmacy drug mix and brand inflation, despite a 1.8% decline in total pharmacy claims processed [4] - Pharmacy & Consumer Wellness segment revenues rose 11.7% year over year to $36.21 billion, primarily due to increased prescription volume [5] - Health Care Benefits segment revenues reached $36 billion, up 9.1% year over year, influenced by growth in the Government business related to the Inflation Reduction Act [5] Margin Performance - Total cost of sold products increased by 7.7% to $57.05 billion, while gross profit rose by 7.9% to $45.83 billion, leading to a gross margin of 44.6% [6] - Adjusted operating margin expanded by 12 basis points to 33.6%, despite a 6.9% rise in total operating expenses [6] Liquidity Position - CVS Health ended Q3 2025 with cash and cash equivalents of $9.10 billion, down from $11.79 billion in the previous quarter, while long-term debt increased to $60.51 billion [7] - Cumulative net cash from operating activities remained stable at $7.25 billion compared to the previous year [7] 2025 Guidance - The company raised its 2025 adjusted EPS guidance to a range of $6.55-$6.65, up from the previous range of $6.30-$6.40, with the current consensus estimate at $6.36 [8] Market Performance - CVS Health's stock has shown a positive trend, gaining approximately 4.1% since the last earnings report, outperforming the S&P 500 [1] - The stock currently holds a Zacks Rank 3 (Hold), indicating an expectation of an in-line return in the coming months [11]