# CVS Health (CVS.US)

Canonical: https://gigainvestors.com/s/CVS

Analysis as of: 2026-10-16T07:27:51.494Z. Financial observations: FY1996–FY2025.

Listing currency: USD. Reporting currency: USD.

## Verdict

Not a wonderful business

Quality tests for Buy: not passed (profit record: pass; earnings resilience is evidence only). Published buy qualification: no.

Share price: $92.58 per share; close as of 2026-10-15.

Estimated value: low $63.89 per share, central $72.70 per share, high $84.43 per share. Buy at or below the central value $72.70 per share. Valuation as of 2026-10-16T07:27:51.494Z; scenarios are not confidence intervals.

Expected annual return: 8.5% at the stated quote. About 8.5% a year at today's price (required return 10.0%). required return 10.0% a year (10% floor; US 10-year bond 5.1% + 4 points).

## Checklist

### understandable: pass

- 0 revenue declines in the last 10 years (informational)

- Financial history: 10 years

- Years with declining revenue: 0

- Years with a net loss: 1

- Operating margin variation: 0.35×

Chart: Operating margin; fiscal year observations.

- FY2016: 0.06×

- FY2017: 0.05×

- FY2018: 0.02×

- FY2019: 0.05×

- FY2020: 0.05×

- FY2021: 0.05×

- FY2022: 0.02×

- FY2023: 0.04×

- FY2024: 0.02×

- FY2025: 0.03×

### moat: fail

- ROIC median below threshold

- ROIC, median of available years: 14.8%

- ROIC, second-lowest year: 11.3%

- Typical minus recent gross margin: 2.5 pp

- Typical gross margin (annual median): 16.2%

- Recent gross margin (lower of latest and 3-year median): 13.8%

- Years with nonpositive capital: 0

- Capital spending / revenue: 0.9%

- ROIC including acquisitions, ten-year median: 5.9%

Chart: ROIC excluding acquisitions; fiscal year observations.

- FY2016: 29.8%

- FY2017: 31.3%

- FY2018: 5.6%

- FY2019: 13.6%

- FY2020: 16.0%

- FY2021: 17.0%

- FY2022: 12.2%

- FY2023: 19.4%

- FY2024: 11.3%

- FY2025: 11.6%

### economics: pass

- Owner earnings / net income, 5-yr: 1.31×

- Cash conversion uses consolidated totals: No

- Owner earnings, five-year total: $35B

- Net income, five-year total: $27B

- Return on incremental invested capital: >100%

- Working capital / revenue, annual change: -0.7 pp

- Working capital / revenue, change between three-year averages: -4.4 pp

- Working capital / revenue, final three-year average: 7.0%

Chart: Annual owner cash / profit; fiscal year observations.

- FY2021: 1.25×

- FY2022: 1.35×

- FY2023: 1.16×

- FY2024: 1.39×

- FY2025: 2.00×

### management: fail

- Historical market-dollar context (not the management verdict): 2016 to 2025 (9 years)

- buybacks leaned toward cheaper years (informational)

- ROIC first 3 years vs last 3 years: 29.8% vs 11.6%

- Per-share earnings: 4.93 to 3.66 (three-year endpoint medians)

- per-share value declined or ends nonpositive

- acquired goodwill and intangibles (proxy) exceeds half of ten-year net income with low and deteriorating ROIC

- Management verdict uses per-share economic progress: Yes

- Ordinary dilution, 10-year annual growth: 1.2%

- Ordinary dilution, 5-year annual growth: -0.7%

- Market cap gain: $17B

- Cumulative retained earnings: $22B

- Diluted shares, 10-year annual growth: 1.2%

- Diluted shares, 5-year annual growth: -0.7%

- $1 test, starting fiscal year: FY2016

- $1 test, ending fiscal year: FY2025

- Per-share value growth: -3.7%

- Per-share value change: -$1.27

- Per-share value, starting three-year median: $4.93

- Per-share value, ending three-year median: $3.66

- Buybacks concentrated in cheaper years (correlation): 0.66

- Average buyback yield: 3.6%

- Buyback history: 6 years

- Debt-funded buybacks: No

- Acquisition spending: $81B

- Cumulative net income, 10 years: $52B

- ROIC, first three-year median: 29.8%

- ROIC, last three-year median: 11.6%

Chart: Earnings per share; fiscal year observations.

- FY2016: $4.93

- FY2017: $6.47

- FY2018: -$0.57

- FY2019: $5.08

- FY2020: $5.46

- FY2021: $6.02

- FY2022: $3.26

- FY2023: $6.47

- FY2024: $3.66

- FY2025: $1.39

### accounting: pass

- Sloan accruals: -3.4%

- Receivables to sales index (DSRI): 1.01×

- Restructuring years, last five: 2

- Stock compensation / operating cash flow: 5.0%

- Earnings backed by cash: Yes

- Operating cash / earnings: 6.02×

- Accounting red flags: 0

- Goodwill and intangibles / equity: 1.48×

Chart: Sloan accruals; fiscal year observations.

- FY2016: -5.1%

- FY2017: -1.5%

- FY2018: -4.8%

- FY2019: -2.8%

- FY2020: -3.8%

- FY2021: -4.4%

- FY2022: -5.2%

- FY2023: -2.0%

- FY2024: -1.8%

- FY2025: -3.4%

## Holders

- [John Rogers](https://gigainvestors.com/AI): tracked 13F investor; follow the investor page for holding quarter and amounts.

- [David Hoeft](https://gigainvestors.com/DAC): tracked 13F investor; follow the investor page for holding quarter and amounts.

- [Christopher Davis](https://gigainvestors.com/DAV): tracked 13F investor; follow the investor page for holding quarter and amounts.

- [Prem Watsa](https://gigainvestors.com/FFH): tracked 13F investor; follow the investor page for holding quarter and amounts.

- [Bill Nygren](https://gigainvestors.com/HA): tracked 13F investor; follow the investor page for holding quarter and amounts.

- [Mark Hillman](https://gigainvestors.com/HCM): tracked 13F investor; follow the investor page for holding quarter and amounts.

- [David Katz](https://gigainvestors.com/MAVFX): tracked 13F investor; follow the investor page for holding quarter and amounts.

- [Richard Pzena](https://gigainvestors.com/PIM): tracked 13F investor; follow the investor page for holding quarter and amounts.

- [Samantha McLemore](https://gigainvestors.com/PTNT): tracked 13F investor; follow the investor page for holding quarter and amounts.

- [Andreas Halvorsen](https://gigainvestors.com/vg): tracked 13F investor; follow the investor page for holding quarter and amounts.

## Price story

Price needs cash profits to grow 3.9% a year for ten years · "CVS' Q2 EPS Gains From Improved Health Care Benefits Profitability" (finance.yahoo.com, Aug 2026) · sales +7.8%

Story as of 2026-10-16T09:58:35.922Z; price observation 2026-10-15.

Price needs cash profits to grow 3.9% a year for ten years

- 2025-06-16: CVS Health stock rises after medicare PBM limits stripped from tax bill ([investing.com](https://www.investing.com/news/stock-market-news/cvs-health-stock-rises-after-medicare-pbm-limits-stripped-from-tax-bill-93CH-4097895))

- 2025-07-08: Judge orders CVS' Omnicare unit to pay $949 million over invalid prescriptions ([investing.com](https://www.investing.com/news/general-news/judge-orders-cvs-omnicare-unit-to-pay-949-million-over-invalid-prescriptions-4127061))

- 2025-08-01: CVS Health beats second quarter expectations, raises full-year profit outlook ([finance.yahoo.com](https://finance.yahoo.com/news/cvs-health-beats-second-quarter-105334827.html))

- 2026-02-10: CVS Health posts strong Q4 revenue, raises full-year guidance ([finance.yahoo.com](https://finance.yahoo.com/news/cvs-health-posts-strong-q4-150400532.html))

- 2026-05-06: CVS HEALTH CORPORATION REPORTS STRONG FIRST QUARTER 2026 RESULTS AND RAISES FULL-YEAR 2026 GUIDANCE ([finance.yahoo.com](https://finance.yahoo.com/sectors/healthcare/articles/cvs-health-corporation-reports-strong-103000392.html))

- 2026-08-05: CVS Falls After Preliminary 2027 Guidance Disappoints ([finance.yahoo.com](https://finance.yahoo.com/healthcare/articles/cvs-falls-preliminary-2027-guidance-134148338.html))

### Sales · FY2024–2025

sales +7.8%; source https://www.sec.gov/Archives/edgar/data/64803/000006480326000010/cvs-20251231.htm; observed 2026-02-10.

- FY2016: $178B 

- FY2017: $185B 

- FY2018: $195B 

- FY2019: $257B 

- FY2020: $269B 

- FY2021: $292B 

- FY2022: $322B 

- FY2023: $358B 

- FY2024: $373B 

- FY2025: $402B 

### Gross margin · FY2025

gross margin 13.8%; source https://www.sec.gov/Archives/edgar/data/64803/000006480326000010/cvs-20251231.htm; observed 2026-02-10.

- FY2016: 16.2% 

- FY2017: 15.4% 

- FY2018: 16.2% 

- FY2019: 17.7% 

- FY2020: 18.3% 

- FY2021: 17.8% 

- FY2022: 16.9% 

- FY2023: 15.2% 

- FY2024: 13.8% 

- FY2025: 13.8% 

## Owner memo

Memo as of 2026-10-16T08:06:05.509Z.

### How it makes money

Operates in healthcare plans; annual sales are USD 402.1 billion.

- Source: https://www.sec.gov/Archives/edgar/data/64803/000006480326000010/cvs-20251231.htm (filed 2026-02-10); FY2025: revenue 402067000000; grossProfit 55362000000; margin = grossProfit / revenue.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-10-16); CVS.US: CVS Health Corporation provides health solutions in the United States. The Health Care Benefits segment offers traditional, voluntary, and consumer-directed health insurance products and related services, including medical, pharmacy, dental, and behavioral health plans; medical management capabilities; Medicare Advantage and Medicare Supplement plans; prescription drug plans (PDPs); and Medicaid health care management services. It serves employer groups, individuals, college students, part-time and hourly workers, health plans, health care providers, governmental units, government-sponsored plans, labor groups, and expatriates. The Health Services segment offers pharmacy benefit management solutions, including plan design and administration, formulary management, retail pharmacy network management, specialty and mail-order pharmacy, clinical services, disease management, medical spend management services, and pharmacy and other administrative services. It serves employers, insurance companies, unions, government employee groups, health plans, PDPs, Medicaid managed care plans, CMS, plans offered on public health insurance exchanges, and other sponsors of health benefit plans. The Pharmacy & Consumer Wellness segment sells prescription and over-the-counter drugs, consumer health and beauty products, personal care products, and other general merchandise products. This segment also distributes prescription drugs; and provides related pharmacy consulting and other ancillary services to care facilities and other care settings. It operates online retail pharmacy websites, retail specialty pharmacy stores, and compounding pharmacies, as well as branches for infusion and enteral nutrition services. The company was formerly known as CVS Caremark Corporation and changed its name to CVS Health Corporation in September 2014. CVS Health Corporation was founded in 1963 and is headquartered in Woonsocket, Rhode Island.

### Why customers stay

Margins ranged from 13.8% to 15.2% during 2023–25; it earns 14.8% on its capital.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-02-10); FY2023: grossProfit / revenue = 15.2%.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-02-10); FY2024: grossProfit / revenue = 13.8%.

- Source: https://www.sec.gov/Archives/edgar/data/64803/000006480326000010/cvs-20251231.htm (filed 2026-02-10); FY2025: grossProfit / revenue = 13.8%.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-02-10); 10-year return on capital observations [[2016,0.2980003531385186],[2017,0.31305708330969806],[2018,0.05633473434637353],[2019,0.13579102876166946],[2020,0.16014264994522595],[2021,0.1698096558868968],[2022,0.12202768601215887],[2023,0.19376865677356703],[2024,0.11300134932508571],[2025,0.11560640018998708]]; median 0.1479668393534477. ROIC follows the displayed moat series; financial companies use return on tangible equity.

### Where the cash goes

Paid dividends in 10 of 10 years.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-02-10); FY2016: growth capex 0; upkeep 2224000000; owner earnings 5568000000. Growth capex / owner earnings = 0.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-02-10); FY2017: growth capex 0; upkeep 1918000000; owner earnings 7183000000. Growth capex / owner earnings = 0.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-02-10); FY2018: growth capex 0; upkeep 2037000000; owner earnings 87000000. Growth capex / owner earnings = 0.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-02-10); FY2019: growth capex 0; upkeep 2457000000; owner earnings 8548000000. Growth capex / owner earnings = 0.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-02-10); FY2020: growth capex 0; upkeep 2437000000; owner earnings 9183000000. Growth capex / owner earnings = 0.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-02-10); FY2021: growth capex 0; upkeep 2520000000; owner earnings 9967000000. Growth capex / owner earnings = 0.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-02-10); FY2022: growth capex 0; upkeep 2727000000; owner earnings 5808000000. Growth capex / owner earnings = 0.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-02-10); FY2023: growth capex 0; upkeep 3031000000; owner earnings 9679000000. Growth capex / owner earnings = 0.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-02-10); FY2024: growth capex 0; upkeep 2781000000; owner earnings 6430000000. Growth capex / owner earnings = 0.

- Source: https://www.sec.gov/Archives/edgar/data/64803/000006480326000010/cvs-20251231.htm (filed 2026-02-10); FY2025: growth capex 0; upkeep 2832000000; owner earnings 3542000000. Growth capex / owner earnings = 0.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-02-10); Dividend observations: [[2016,1840000000],[2017,2049000000],[2018,2038000000],[2019,2603000000],[2020,2624000000],[2021,2625000000],[2022,2907000000],[2023,3132000000],[2024,3373000000],[2025,3397000000]]. Zero only counted when supported by a complete cash-flow statement.

### Are managers owners

Insiders own 0.1% of the company.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-10-16); CVS.US SharesStats.PercentInsiders = 0.063 percentage points; cache date 2026-10-16.

### What could break it

"We may not be able to accurately forecast health care and other benefit costs" (SEC filing, Feb 2026)

- Source: https://www.sec.gov/Archives/edgar/data/64803/000006480326000010/cvs-20251231.htm (filed 2026-02-10); We may not be able to accurately forecast health care and other benefit costs

### What the price says

The price assumes cash profits grow 3.9% yearly over ten years; actual decline was 5%.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-02-10); Ten-year compound average after fade. Initial solved rate 0.04319393329630916. Price 92.58; FX 1; discount 0.1; same standard ten-year fade to terminal 0.03. FY2015 owner earnings/share 4.650976909413854 → FY2025 2.7867820613690006. Closing-price date 2026-10-15.

## Monthly share-price history (USD per share)

- 2016-10: $84.10 per share

- 2016-11: $76.89 per share

- 2016-12: $78.91 per share

- 2017-01: $78.81 per share

- 2017-02: $80.58 per share

- 2017-03: $78.50 per share

- 2017-04: $82.44 per share

- 2017-05: $76.83 per share

- 2017-06: $80.46 per share

- 2017-07: $79.93 per share

- 2017-08: $77.34 per share

- 2017-09: $81.32 per share

- 2017-10: $68.53 per share

- 2017-11: $76.60 per share

- 2017-12: $72.50 per share

- 2018-01: $78.69 per share

- 2018-02: $67.73 per share

- 2018-03: $62.21 per share

- 2018-04: $69.83 per share

- 2018-05: $63.39 per share

- 2018-06: $64.35 per share

- 2018-07: $64.86 per share

- 2018-08: $75.24 per share

- 2018-09: $78.72 per share

- 2018-10: $72.39 per share

- 2018-11: $80.20 per share

- 2018-12: $65.52 per share

- 2019-01: $65.55 per share

- 2019-02: $57.83 per share

- 2019-03: $53.93 per share

- 2019-04: $54.38 per share

- 2019-05: $52.37 per share

- 2019-06: $54.49 per share

- 2019-07: $55.87 per share

- 2019-08: $60.92 per share

- 2019-09: $63.07 per share

- 2019-10: $66.39 per share

- 2019-11: $75.27 per share

- 2019-12: $74.29 per share

- 2020-01: $67.82 per share

- 2020-02: $59.18 per share

- 2020-03: $59.33 per share

- 2020-04: $61.55 per share

- 2020-05: $65.57 per share

- 2020-06: $64.97 per share

- 2020-07: $62.94 per share

- 2020-08: $62.12 per share

- 2020-09: $58.40 per share

- 2020-10: $56.09 per share

- 2020-11: $67.79 per share

- 2020-12: $68.30 per share

- 2021-01: $71.65 per share

- 2021-02: $68.13 per share

- 2021-03: $75.23 per share

- 2021-04: $76.40 per share

- 2021-05: $86.44 per share

- 2021-06: $83.44 per share

- 2021-07: $82.36 per share

- 2021-08: $86.39 per share

- 2021-09: $84.86 per share

- 2021-10: $89.28 per share

- 2021-11: $89.06 per share

- 2021-12: $103.16 per share

- 2022-01: $106.51 per share

- 2022-02: $103.65 per share

- 2022-03: $101.21 per share

- 2022-04: $96.13 per share

- 2022-05: $96.75 per share

- 2022-06: $92.66 per share

- 2022-07: $95.68 per share

- 2022-08: $98.15 per share

- 2022-09: $95.37 per share

- 2022-10: $94.70 per share

- 2022-11: $101.88 per share

- 2022-12: $93.19 per share

- 2023-01: $88.22 per share

- 2023-02: $83.54 per share

- 2023-03: $74.31 per share

- 2023-04: $73.31 per share

- 2023-05: $68.03 per share

- 2023-06: $69.13 per share

- 2023-07: $74.69 per share

- 2023-08: $65.17 per share

- 2023-09: $69.82 per share

- 2023-10: $69.01 per share

- 2023-11: $67.95 per share

- 2023-12: $78.96 per share

- 2024-01: $74.37 per share

- 2024-02: $74.37 per share

- 2024-03: $79.76 per share

- 2024-04: $67.71 per share

- 2024-05: $59.60 per share

- 2024-06: $59.06 per share

- 2024-07: $60.33 per share

- 2024-08: $57.24 per share

- 2024-09: $62.88 per share

- 2024-10: $56.46 per share

- 2024-11: $59.85 per share

- 2024-12: $44.89 per share

- 2025-01: $56.48 per share

- 2025-02: $65.72 per share

- 2025-03: $67.75 per share

- 2025-04: $66.71 per share

- 2025-05: $64.04 per share

- 2025-06: $68.98 per share

- 2025-07: $62.10 per share

- 2025-08: $73.15 per share

- 2025-09: $75.39 per share

- 2025-10: $78.15 per share

- 2025-11: $80.36 per share

- 2025-12: $79.36 per share

- 2026-01: $74.52 per share

- 2026-02: $79.90 per share

- 2026-03: $71.82 per share

- 2026-04: $83.29 per share

- 2026-05: $90.98 per share

- 2026-06: $103.45 per share

- 2026-07: $104.43 per share

- 2026-08: $93.91 per share

- 2026-09: $85.69 per share

- 2026-10: $87.55 per share

## Annual estimated value (USD per share)

- FY2016: low $67.40 per share, central $86.74 per share, high $101.39 per share

- FY2017: low $80.92 per share, central $111.50 per share, high $130.75 per share

- FY2018: low $67.88 per share, central $77.24 per share, high $89.70 per share

- FY2019: low $83.51 per share, central $111.64 per share, high $130.73 per share

- FY2020: low $87.57 per share, central $118.15 per share, high $138.42 per share

- FY2021: low $95.67 per share, central $127.98 per share, high $149.88 per share

- FY2022: low $93.03 per share, central $111.33 per share, high $129.64 per share

- FY2023: low $115.29 per share, central $150.83 per share, high $176.44 per share

- FY2024: low $89.39 per share, central $104.23 per share, high $121.20 per share

- FY2025: low $62.28 per share, central $70.86 per share, high $82.29 per share

Historical values use today's bond yield for every fiscal year

Historical values use today's FX rate into trading currency for every fiscal year

Historical values use current restated fundamentals and current commodity classification; they are not point-in-time estimates

## Sources

[Original 10-K filing](https://www.sec.gov/Archives/edgar/data/64803/000006480326000010/cvs-20251231.htm); period 2025-12-31, filed 2026-02-10.

Estimates depend on assumptions and are not guarantees or investment advice. Underlying data remains subject to its source licenses; public reading does not grant bulk redistribution rights.