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CVS Caremark Third Quarter Earnings
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CVS Caremark (NYSE:CVS) announced its results for the most recent quarter on November 6, 2012. CVS Caremark provides prescriptions and related health care services and products.
Earnings season is important to investors because it shows how much profit is left in the company's hand after deducting costs from revenue. SEE: 12 Things You Need To Know About Financial Statements
The Numbers: CVS Caremark's EPS topped estimates and revenues were in line with expectations. The company reported adjusted net income of 85 cents per share versus the 84 cents per share estimate and revenues of $30.2 billion versus the $30.31 billion estimate. Revenue climbed 13.2% from the same period last year. CVS Caremark has averaged revenue growth of 14.7% over the past five quarters. For the third quarter, the company reported net income of $1.01 billion. According to the reported number, this is up 15.9% from last year's figures. Last quarter marked the third in a row of rising net income.
Management Quote: Larry Merlo, president and CEO, stated, "I'm very pleased with our third quarter earnings, which exceeded the high end of our guidance range by two cents per share. We posted strong results across the enterprise, with the Pharmacy Services Segment significantly outpacing our growth expectations. The retail pharmacy business continued to capitalize on the market disruption resulting from the impasse between two of our competitors, and our retention of the prescriptions we gained during that impasse has been strong since their dispute was resolved in mid-September. Given what we have seen to date, we are optimistic that we will exceed our initial retention goal for the fourth quarter and now expect to retain at least 60% of the prescriptions gained during the impasse."
A Look Back: Net income has increased 10.8% year-over-year on average across the last five quarters. The biggest gain came in the second, when income climbed 18.4% from the year-earlier quarter.
Looking Ahead: Expectations for the company's next-quarter performance are higher than they were 90 days ago. Over the past three months, the average estimate for the fourth quarter has risen to $1.08 per share from $1.06. When analyst increase earnings estimates investors can assume business has been stronger than first thought and is an encouraging sign for investors. The average estimate for the fiscal year is $3.36 per share, up from $3.35 seven days ago.
Earnings season is important to investors because it shows how much profit is left in the company's hand after deducting costs from revenue. SEE: 12 Things You Need To Know About Financial Statements
The Numbers: CVS Caremark's EPS topped estimates and revenues were in line with expectations. The company reported adjusted net income of 85 cents per share versus the 84 cents per share estimate and revenues of $30.2 billion versus the $30.31 billion estimate. Revenue climbed 13.2% from the same period last year. CVS Caremark has averaged revenue growth of 14.7% over the past five quarters. For the third quarter, the company reported net income of $1.01 billion. According to the reported number, this is up 15.9% from last year's figures. Last quarter marked the third in a row of rising net income.
Management Quote: Larry Merlo, president and CEO, stated, "I'm very pleased with our third quarter earnings, which exceeded the high end of our guidance range by two cents per share. We posted strong results across the enterprise, with the Pharmacy Services Segment significantly outpacing our growth expectations. The retail pharmacy business continued to capitalize on the market disruption resulting from the impasse between two of our competitors, and our retention of the prescriptions we gained during that impasse has been strong since their dispute was resolved in mid-September. Given what we have seen to date, we are optimistic that we will exceed our initial retention goal for the fourth quarter and now expect to retain at least 60% of the prescriptions gained during the impasse."
A Look Back: Net income has increased 10.8% year-over-year on average across the last five quarters. The biggest gain came in the second, when income climbed 18.4% from the year-earlier quarter.
Looking Ahead: Expectations for the company's next-quarter performance are higher than they were 90 days ago. Over the past three months, the average estimate for the fourth quarter has risen to $1.08 per share from $1.06. When analyst increase earnings estimates investors can assume business has been stronger than first thought and is an encouraging sign for investors. The average estimate for the fiscal year is $3.36 per share, up from $3.35 seven days ago.
by
Investopedia Staff
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