CVS Health (NYSE: CVS) reported Q1 EPS of $1.18, $0.02 better than the analyst estimate of $1.16. Revenue for the quarter came in at $43.2 billion versus the consensus estimate of $43.01 billion.

Revenues in the Retail/LTC Segment increased 18.6%, or $3.2 billion, to $20.1 billion, in the three months ended March 31, 2016. The increase was primarily driven by the addition of the long-term care ("LTC") operations acquired as part of the acquisition of Omnicare, Inc. ("Omnicare") in August 2015, the addition of the pharmacies and clinics of Target Corporation ("Target") acquired in December 2015 and pharmacy same store sales growth. Same store sales increased 4.2% versus the first quarter of last year. Same store sales were positively affected by approximately 125 basis points due to an additional day in 2016 related to leap year. Pharmacy same store sales rose 5.5% and pharmacy same store prescription volumes rose 5.9% on a 30-day equivalent basis. Pharmacy same store sales were negatively affected by approximately 360 basis points from recent generic drug introductions, and positively affected by approximately 130 basis points from the additional day in 2016 related to leap year. Front store same store sales increased 0.7%. Front store same store sales were negatively affected by softer customer traffic, partially offset by an increase in basket size and the shift of Easter from April in 2015 to March in 2016, which positively affected front store same store sales by approximately 80 basis points. Front store same store sales were also positively affected by approximately 105 basis points from the additional day in 2016 related to leap year.

GUIDANCE:

CVS Health sees Q2 2016 EPS of $1.28-$1.31, versus the consensus of $1.35.

FY16 adjusted EPS guidance was affirmed.

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