CVS Health Corp. stock
soared 5% in premarket trade Wednesday, after the company announced a $5 billion settlement of opioid claims and third-quarter earnings blew past estimates. The company swung to a loss of $3.409 billion, or $2.60 a share, for the third quarter, after income of $1.587 billion, or $1.20 a share, in the year-earlier period. Adjusted for the settlement, the drug store chain had EPS of $2.09, ahead of the $2.00 FactSet consensus. Revenue rose to $81.159 billion from $73.794 billion a year ago, well ahead of the $76.740 billion FactSet consensus. The profit number was also weighed down a $2.5 billion loss on assets head for sale to write down the company’s long-term care business in the current year, partially offset by the lack of a $431 million goodwill impairment charge on the remaining goodwill of the LTC unit in the prior year. “We continue to execute on our strategy with a focus on expanding capabilities in health care delivery, and the announced acquisition of Signify Health will further strengthen our engagement with consumers,” CEO Karen S. Lynch said in a statement. CVS is now expecting full-year EPS of $3.12 to $3.22, down from prior guidance of $7.23 to $7.43, mostly due to the opioid settlement. Adjusted EPS however, is expected to range from $8.55 to $8.65, up from prior guidance of $8.40 to $8.60. Shares have fallen 8% in the year to date, while the S&P 500
has fallen 19%.
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