CVS tops profit estimates on Aetna strength
Reuters
Published Nov 06, 2019 07:02AM ET
(Reuters) - CVS Health Corp (N:CVS) posted a better-than-expected quarterly profit on Wednesday, boosted by its pharmacy benefit management unit and the Aetna (NYSE:AET) health insurance business it acquired last year.
Shares of the company rose 3% in premarket trading after the company also raised its 2019 adjusted profit forecast range to $6.97 to $7.05 per share, from $6.89 to $7.00.
Sales in the company's pharmacy services unit increased 6.4% to $36.02 billion in the third quarter, helped by a rise in prices of branded drugs and increased claims.
The company, which also runs drugstores, closed its $69 billion purchase of Aetna in November 2018.
Sales in its health care benefits business, which houses Aetna, soared to $17.18 billion, helped by lower-than-expected medical costs. The unit reported a medical benefit ratio of 83.3%, compared with estimates of 84.3% according to four analysts polled by Refinitiv.
CVS Health's net profit rose 10.1% to $1.53 billion, or $1.17 per share, in the quarter ended Sept. 30.
Excluding items, the company earned $1.84 per share, above analysts' estimates of $1.77.
Revenue jumped 36.5% to $64.81 billion.
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Written By: Reuters
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