), which operates more than 7,600 CVS/pharmacy stores, announced
that it will stop selling tobacco products at all
of its locations
. In the press release, CEO Larry Merlo stated that it
"is the right thing for us to do for our customers and our
company to help people on their path to better health"
, and added that
"the sale of tobacco products is inconsistent with our
The company estimates that it will lose approximately $2
billion in annual revenues from the
(CVS generated over $125 billion in revenue over the last 12
months), and it expects 2014 EPS to be negatively impacted by 6-9
However, CVS has indentified
to offset the profitability hit. So the company actually
maintained its 2014 EPS guidance and its five-year financial
projections provided in December at its Analyst Day!
Shares of CVS were down as much as -1.2% on Tuesday but
recovered a bit by midday. CVS will report its Q4 results before
the bell on Tuesday, February 11.
So what do you think of CVS's decision to stop selling
Is it bad for business since "tobacco shoppers" will likely
just shop elsewhere? Or is it a good PR move that will ultimately
benefit the company? Chime in below!
CVS CAREMARK CP (CVS): Free Stock Analysis
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