2024-07-07 11:05:59 ET
Summary
- CVS Health's stock plummeted 17% after disappointing Q1 results, partially due to increased medical costs and lower than expected earnings.
- CVS and Walgreens have different business models, with CVS focusing on health services and benefits, while Walgreens relies heavily on retail pharmacy operations.
- Despite short-term headwinds, CVS's solid balance sheet, dividend yield, and diversified business model make it a reasonable buy for investors seeking passive income.
Investors were rocked by CVS Health Corporation’s ( CVS ) Q1 results. Debuting on May Day, the earnings report caused the stock to plummet 17%, with CVS posting its worst one-day drop in over a decade.
The stock had made up nearly half of that loss when a second earnings report was released. Only this time, it was rival Walgreens' ( WBA ) third quarter results that provided the headwind. With WBA management issuing a downward revision of guidance, along with an announcement that the company was closing stores, CVS was found guilty by association and paid the price....
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CVS Health: Good Buy Vs. Goodbye