CVS - CVS Health: Here Comes The Floor - Inherent Undervaluation Triggers Great Upside Potential

2024-03-15 16:00:00 ET

Summary

• CVS' vertically integrated healthcare offerings continue to well balance each other as the increased healthcare utilizations trigger expanded pharmacy volumes.
• It is important to note that the same headwinds are experienced by its healthcare peers, with the correction in the bottom lines being inevitable.
• For now, CVS remains inherently undervalued with discounted valuations compared to its peers, with an eventual re-rating likely to bring forth expanded upside potential.
• Readers may also enjoy a relatively secure dividend investment thesis, attributed to its robust profitability and healthy balance sheet.
• As a result of its (prospective) dual-pronged returns through capital appreciation and dividend payouts, we are maintaining our Buy rating for the CVS stock.

We previously covered CVS Health ( CVS ) in October 2023, discussing its uncertain prospects as the regulatory scrutiny surrounding the managed healthcare industry increased, with its growth likely to decelerate as regulators tamp down on its future acquisitions and health care utilization normalized....

For further details see: