By RTT News,
December 18, 2013, 09:02:00 AM EDT
(RTTNews.com) - Drugstore chain CVS Caremark Corp. ( CVS ) on Wednesday reaffirmed its financial guidance for fiscal 2013 and forecast adjusted earnings for fiscal 2014 in line with analysts' estimates.
In addition, the company's board of directors approved a 22 percent increase in the quarterly dividend and approved a share repurchase program for up to $6 billion of the company's outstanding common stock.
Woonsocket, Rhode Island-based CVS Caremark said that at its annual Analyst Day in New York City today, Executive Vice President and Chief Financial Officer Dave Denton reiterated the company's earnings guidance for fiscal 2013.
On average, twenty four analysts polled by Thomson Reuters expect the company to report earnings of $3.96 per share for the year. Analysts' estimates typically exclude special items.
For fiscal 2014, CVS Caremark forecasts adjusted earnings per share from continuing operations in a range of $4.36 to $4.50, and reported earnings per share from continuing operations in a range of $4.09 to $4.23 per share. Analysts expect the company to report earnings of $4.47 per share for the year.
CVS Caremark expects to generate substantial free cash flow of $5.1 billion to $5.4 billion, and cash from operations of $6.6 billion to $6.9 billion in 2014. The guidance assumes completion of $4 billion in share repurchases during the year as well as the impact of the company's pending acquisition of Coram's infusion business, among others.
CVS Caremark also outlined its strategies to drive long-term enterprise growth through its breadth of assets and its nimbleness in responding to changes in the marketplace while delivering strong results.
The company's executives emphasized its business model that focuses on enhancing access, lowering costs and improving health outcomes through consumer-driven, channel-agnostic solutions. In addition, the company demonstrated its focus on enterprise growth and underlined its commitment to enhancing shareholder value.
Larry Merlo, president and chief executive officer of CVS Caremark said, "Looking to the future, our enterprise growth strategy will continue to capitalize on our unique competitive advantages. We're focused on winning new lives, whether or not we are the PBM, and on capturing greater share of pharmacy spend across all channels."
Denton said, "The outlook for 2014 is bright, and we are focused on strategies that will lead to solid, long-term enterprise growth. We continue to generate a substantial amount of free cash flow and we remain committed to disciplined capital allocation practices that drive value for our shareholders."
In addition, CVS Caremark's board of directors approved a 22 percent increase in the quarterly dividend to $0.275 per share on the common stock of the company. This increase translates into an annual rate of $1.10 per share, up 20 cents per share from the previous annual rate of $0.90. The quarterly dividend is payable February 3, 2014, to holders of record on January 23, 2014.
CVS Caremark's board also approved a new share repurchase program for up to $6.0 billion of the company's outstanding common stock. The company noted that the share repurchase authorization is effective immediately and is expected to be completed over a multi-year period.
CVS closed Tuesday's trading at $66.81, down $0.98 or 1.45 percent on a volume of 5.95 million shares.
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