Vaccine sales may fade over time, but they should remain higher than levels seen before the pandemic as COVID-19 shots become part of a seasonal routine for customers like flu shots, Edward Jones analyst John Boylan said in a research note.
CVS operates one of the nation’s largest drugstore chains with nearly 10,000 retail locations, a total it expects to pare by about 300 this year through a store optimization program. It also runs prescription drug plans for big clients like insurers and employers through its pharmacy benefit management business, and it provides health insurance for more than 24 million people through its Aetna arm.
Sales outside the pharmacy area of CVS Health's established drugstores climbed more than 9% in the quarter, a jump aided by COVID-19 test kits that customers can buy without a prescription.
Company drugstores could see more gains in the back half of the year from treating more COVID-19 patients. Last month, the Food and Drug Administration said pharmacists can begin screening patients to see if they are eligible for Pfizer’s COVID-19 treatment Paxlovid and then prescribe the medication.
Overall, quarterly net income climbed 6% to $2.96 billion in the second quarter, and adjusted earnings totaled $2.40 per share. Total revenue topped $80.6 billion.
Analysts predicted earnings of $2.18 per share on $76.41 billion in revenue, according to FactSet.
CVS Health now expects to post adjusted earnings of $8.40 to $8.60 per share this year. That represents a 20-cent hike at both ends of the range from its previous forecast.
Industry analysts have been projecting earnings of $8.35 per share, according to FactSet.
Shares of CVS Health Corp., based in Woonsocket, Rhode Island, climbed 4% or $4.20 to $99.57 in late-morning trading Wednesday, while broader markets rose slightly.
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