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CVS Caremark Reports In-Line Q2 Profit, but Slashes Outlook Below View (CVS)

Drug store chain operator CVS Caremark Corporation ( CVS

) on Wednesday posted second quarter earnings that were in-line with Wall Street expectations, but lowered its full-year forecast, sending its shares tumbling in premarket trading.

The Woonsocket, RI-based company reported second quarter net income of $821 million, or 60 cents per share, compared with $886 million, or 60 cents per share, in the year-ago period. Excluding one-time items, adjusted profit was 68 cents per share.

On average, Wall Street analysts expected a matching profit of 68 cents per share for the quarter.

Overall net revenue fell 3.5% from last year, to $24.01 billion.

Looking ahead, the company cut its full-year earnings forecast to a range of $2.68 to $2.73 per share, which would miss analyst expectations of $2.79 per share for the year. As a result, CVS shares plunged $1.05, or -3.3%, in premarket trading Wednesday.

The Bottom Line

We recently removed shares of CVS back on Nov.5, when the stock was trading at $36.15. The company has a dividend yield of 1.14%, based on last night's closing stock price of $30.60. The stock has near-term technical support in the $27 price area. If the shares can firm up, we see overhead resistance around the $32-$34 price levels. We would remain on the sidelines for now.

CVS Caremark Corporation ( CVS ) is not recommended at this time, holding a Dividend.com DARS™ Rating of 3.4 out of 5 stars.

Be sure to visit our complete recommended list of the Best Dividend Stocks , as well as a detailed explanation of our ratings system here .

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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