NYSE$CVS

CVS Health Corp · Q3 2022 earnings

Q3 2022 earnings · · Investor relations

Briefing

CVS Health's financial performance was impacted by opioid litigation charges and a loss on assets held for sale, but adjusted EPS still increased.

CVS Health reported a revenue increase of 10.0% to $81.2 billion. However, the company experienced a GAAP loss per share of $(2.60) due to significant charges, including $5.2 billion for opioid litigation and $2.5 billion related to the Omnicare long-term care business. Despite the loss, the adjusted EPS was $2.09.

  • Total revenues increased to $81.2 billion, up 10.0% compared to prior year.
  • GAAP loss per share of $(2.60), inclusive of $5.2 billion pre-tax opioid litigation charges and a $2.5 billion pre-tax loss on assets held for sale related to the Omnicare® long-term care business.
  • Adjusted EPS of $2.09.
  • The company entered into a definitive agreement to acquire Signify Health, Inc. for $30.50 per share in cash.

Headline financials

Total Revenue

$81.2B

Previous: $73.8B+10.0%
EPS (adj)

$2.09

Previous: $1.97+6.1%
Total Medical Membership

24.3M

No prior period
Capital Expenditures

-$2.04B

Previous: -$1.92B-6.0%
Free Cash Flow

-$5.46B

Previous: -$325M-1578.5%
Net Income

-$3.42B

Previous: $1.6B-313.8%
Operating Income

-$3.93B

Previous: $3.06B-228.4%
Gross Profit

$30.8B

Previous: $28.8B+7.0%
Cash & Equivalents

$17.2B

Previous: $9.83B+75.0%
Total Assets

$231B

Previous: $235B-1.6%
Stock-Based Comp

$105M

Previous: $114M-7.9%

Revenue & EPS history

CVS Health · Revenue · Quarterly

$81.2B

Q3 2022+10%vs Q3 2021
Beat estimate in 12 of 15 quarters(80%)
ActualEstimate

Revenue by segment

CVS Health · $92.4B total across 3 segments · Q3 2022

  • Health Services
    $43.2B+10.7%
  • Pharmacy & Consumer Wellness
    $26.7B+6.9%
  • Health Care Benefits
    $22.5B+9.9%

Forward guidance

CVS Health revised its full-year 2022 GAAP diluted EPS guidance range to $3.12 to $3.22 from $7.23 to $7.43 and raised its full-year 2022 Adjusted EPS guidance range to $8.55 to $8.65 from $8.40 to $8.60. The Company also raised its full-year 2022 cash flow from operations guidance range to $13.5 billion to $14.5 billion from $12.5 billion to $13.5 billion.

Tailwinds

  • Raised Adjusted EPS guidance range to $8.55 to $8.65 from $8.40 to $8.60
  • Raised cash flow from operations guidance range to $13.5 billion to $14.5 billion from $12.5 billion to $13.5 billion
  • The adjustments between full-year 2022 GAAP diluted EPS and Adjusted EPS include amortization of intangible assets
  • The adjustments between full-year 2022 GAAP diluted EPS and Adjusted EPS include opioid litigation charges
  • The adjustments between full-year 2022 GAAP diluted EPS and Adjusted EPS include losses on assets held for sale

Headwinds

  • Revised GAAP diluted EPS guidance range to $3.12 to $3.22 from $7.23 to $7.43
  • Forward-looking statements are not guarantees of future performance or results and are subject to risks and uncertainties
  • Actual results may differ materially from those contemplated by the forward-looking statements due to the risks and uncertainties related to the COVID-19 pandemic
  • The risk that the acquisition may not close in the anticipated timeframe or at all due to one or more of the other closing conditions to the transaction not being satisfied or waived
  • The risk that any announcements relating to the proposed transaction could have adverse effects on the market price of CVS Health’s common stock, credit ratings or operating results

Historical earnings impact

How earnings announcements have historically affected this stock's price.

Avg. return before/after earnings

Based on 20 quarterly earnings reports · overlaid with Q3 2022

Historical avgQ3 2022

+0.1%

Avg return

Earnings day

+1.4%

Avg return

5 days after

+1.3%

Avg return

30 days after

56%

41 / 73 earnings

Positive

+14.9%

Q4 2024

Best reaction

-18.5%

Q1 2024

Worst reaction

Earnings price reactions
QuarterReport dateReaction (Day 0)+5 days+30 days
Q1 2026-0.2%+14.3%+19.1%
Q4 2025-0.1%+3.6%+0.4%
Q3 2025-1.9%-4.6%-2.2%
Q2 2025-0.3%+1.8%+17.4%
Q1 2025+4.1%-0.7%-4.0%
Q4 2024+14.9%+19.7%+19.4%
Q3 2024+3.1%+0.8%-0.1%
Q2 2024-0.8%-4.3%-1.0%
Q1 2024-18.5%-17.3%-12.0%
Q4 2023+1.8%+4.8%+1.8%
Q3 2023+0.9%+3.0%-0.8%
Q2 2023+0.5%-0.1%-11.2%
Q1 2023-5.5%-4.2%-3.8%
Q4 2022+4.8%+4.5%-10.3%
Q3 2022+3.4%+6.9%+8.4%
Q2 2022+6.8%+7.0%+4.3%
Q1 2022+1.8%+3.0%-1.1%
Q4 2021-5.0%-7.1%-6.6%
Q3 2021+3.7%+2.9%-0.3%
Q2 2021-4.7%-2.8%+4.1%
Q1 2021+6.9%+9.6%+12.1%
Q4 2020-2.0%-5.1%+0.4%
Q3 2020+10.0%+13.2%+21.3%
Q2 2020-1.3%+1.1%-7.3%
Q1 2020+0.4%+4.3%+11.7%
Q4 2019-2.5%-3.4%-19.2%
Q3 2019+6.6%+6.6%+11.9%
Q2 2019+9.2%+8.6%+15.0%
Q1 2019+4.3%+4.1%-3.7%
Q4 2018-10.8%-12.4%-19.8%
Q3 2018+6.9%+8.3%+3.9%
Q2 2018+4.8%+6.2%+18.1%
Q1 2018-8.4%-9.2%-5.8%
Q4 2017-6.7%-5.7%-6.8%
Q3 2017-0.4%+2.5%+3.1%
Q2 2017+0.4%+0.4%+1.6%
Q1 2017-2.8%-1.1%-4.5%
Q4 2016+1.9%+2.1%+4.4%
Q3 2016-8.2%-10.0%-6.3%
Q2 2016+4.2%+4.2%-0.1%
Q1 2016+2.4%
Q4 2015+3.9%
Q3 2015-3.3%
Q2 2015-1.4%
Q1 2015+0.9%
Q4 2014+3.0%
Q3 2014+1.6%
Q2 2014-0.4%
Q1 2014+2.6%
Q4 2013+2.4%
Q3 2013+3.0%
Q2 2013-4.1%
Q1 2013+1.3%
Q4 2012-1.0%
Q3 2012+0.1%
Q2 2012+1.5%
Q1 2012+2.9%
Q4 2011-1.2%
Q3 2011+6.3%
Q2 2011-5.7%
Q1 2011+3.9%
Q4 2010-0.2%
Q4 2007-0.2%
Q3 2010+3.2%
Q2 2010-2.7%
Q1 2009-2.8%
Q1 2010-2.2%
Q4 2009+1.2%
Q3 2008-17.6%
Q3 2009-17.6%
Q4 2008+1.1%
Q2 2008+1.1%
Q2 2009+1.1%

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