External view of CVS pharmacy in Danville, Pennsylvania.
Paul Weaver Lightrockket | Gety pictures
CVS Health On Wednesday, the revenues and profit were mentioned in the fourth quarter that topped the estimates, even with the continued disturbed insurance work in seeing higher medical costs.
The company also issued the payment expectations in the entire 2025 from $ 5.75 to $ 6 per share, which was in line with Wall Street’s expectations. But CVs did not provide revenue expectations this year.
It starts from the first quarter with David JoinnerCVS for a long time, CVS, as CEO of the troubled retail pharmacy chain. Goenner Karen Lynch succeeded in mid -October, where CVS struggled to make higher profits and improve stock performance.
The company has undergone management as part of a broader transformation plan that includes 2 billion dollars in cost Discounts during the next few years. CVS is struggling with high costs in its insurance unit, AETNA, and a retail pharmacy company that has been under pressure by the most softened consumer spending and lower amounts of lower medication prescribed.
Here is what CVS for the fourth quarter compared to what Wall Street expected, based on a survey of analysts by LSEG:
- Arrow’s profits: 1.19 dollars per share for 93 cents for the expected stock
- profit: 97.71 billion dollars for 97.19 billion dollars expected
The shares increased more than 6 % in the pre -market trade.
CVS and other insurance companies such as UNITEDHELHELTH Group and Humana Medical costs that rise during the past year with more Medicare Advantage patients returned to hospitals for procedures that were delayed during the epidemic.
Medicare Advantage, a health insurance plan it has from the private sector contracting with Medicare, has always been an engine for growth and profits for insurance companies. But investors have become concerned about the fleeing costs associated with these plans, which cover more than half of all the beneficiaries of medical care.
CVS booked $ 97.19 billion sales for the fourth quarter, an increase of 4.2 % of the same last period due to growth in the business unit and pharmaceutical insurance.
The company recorded a net income of $ 1.64 billion, or $ 1.30 per share, for the fourth quarter. This compares with the net income of $ 2.05 billion, or $ 1.58 per share during the year.
With the exception of some items, such as extinguishing the unfinished assets, restructuring fees and capital losses, modified profits amounted to $ 1.19 per share for a quarter.
CVS said that its profits in the fourth quarter reflect the highest medical costs in its insurance work and the low stars classes for Medical Care for the year 2024, both of which were weighed on the results of the sector’s operation for the quarter. These stars classifications help medical care patients in comparing the quality of health care and drugs.
Click on the insurance unit
Each of the three business sectors beat Wall Street in the fourth quarter.
The insurance company from CVS reserved 32.96 billion dollars in revenue during the quarter, an increase of more than 23 % of the fourth quarter of 2023. Analysts expected that the unit would operate at $ 32.89 billion for this period, according to street estimates.
However, the company reported a modified operating loss of $ 439 million for the fourth quarter, compared to the modified operating income of $ 676 million in the period of the year. This change was driven by the company’s higher medical costs and the company’s MEDICARADANTATAGATATATANTATATATATATATATION Classes, among other factors.
The percentage of medical benefits for the insurance unit – a measure of the total paid medical expenses for the collected installments – increased to 94.8 % of 88.5 % in the previous year. The low percentage usually indicates that the company was collected in larger installments than the advantages, which leads to high profitability.
Street Street estimates said that the fourth quarter was less than 95.9 % that analysts expect.
The CVS health services sector achieved 47.02 billion dollars in revenue for this quarter, a decrease of more than 4 % compared to the same quarter in 2023. Analysts expected the unit to publish $ 44.06 billion in sales for the period, according to Street Street.
This unit includes Caremark, one of the largest pharmacy directors in the country. Caremark negotiates drug discounts with manufacturers on behalf of insurance plans and the creation of lists of drugs, or formulas, covered by insurance and pharmacies to obtain medical prescriptions.
The CVS Health Services Department has processed 499.4 million pharmacy claims during the quarter, a decrease of 600.8 million claims during the last period due to the loss of a large customer who has not been named. Tyson foods Tell CNBC in January 2024 that The biographies were dropped Since the pharmacy director of its employees is approximately 140,000 employees, but it is not clear whether any other companies have stopped working with CVS during the year, too.
The pharmacy and wellness department in CVS 33.51 billion dollars from sales for the fourth quarter, increased more than 7 % of the same period in the previous year. Street Street said that analysts expected sales of $ 33.03 billion per quarter.
This unit behaves medical prescriptions in more than 9000 pharmacies for retail and provides other pharmacy services, such as vaccinations and diagnostic tests.
The CV said that the increase was partially driven by a higher prescription size. Pharmacy repayment pressure, launch of new general medications and lower volume of front elements such as foods and hygiene supplies, including a decrease in the number of stores, weighed on unit sales.
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