FBR Capital Remains Buyers of CVS Health (CVS) Following 'Solid' Quarter
FBR Capital analyst Steven Halper reiterated an Outperform rating and $120 price target on CVS Health (NYSE: CVS) following a 'solid' Q2. The firm remains buyers of the stock.
Halper commented, "On August 2, CVS reported strong 2Q16 results with the PBM segment performing slightly better than expectations. Claim growth remains strong, and specialty revenue grew 23%. CVS indicated strong selling season results for 2017. Retail/longterm care (LTC) was essentially in line with expectations, with SSS growing 2.1% in the quarter. The company raised its 2016 adjusted EPS guidance and increased its free cash flow outlook significantly. We are encouraged by the strong results in 2Q16. We remain confident that CVS will continue to deliver strong results for the remainder of the year, and we are encouraged by the PBM selling season comments. The shares trade at a 23% discount to our DCF-based price target of $120, even after reflecting the strength in the shares today. Our rating remains Outperform."
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Shares of CVS Health closed at $93.49 yesterday.