Back to top

Real Time Insight

CVS Caremark (CVS - Analyst Report), which operates more than 7,600 CVS/pharmacy stores, announced Tuesday morning 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 purpose."

The company estimates that it will lose approximately $2 billion in annual revenues from the "tobacco shopper" (CVS generated over $125 billion in revenue over the last 12 months), and it expects 2014 EPS to be negatively impacted by 6-9 cents.

However, CVS has indentified "incremental opportunities" 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 tobacco products?

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!

Zacks Releases Their 7 Best Stocks for September, 2014

These 7 were hand-picked from the list of 220 Zacks Rank #1 Strong Buys with earnings estimate revisions that are sweeping upward. Their stock prices are expected to rise sooner than the others.

Today, this Special Report is available to new Zacks.com visitors free of charge.

Close This Panel X

Please login to Zacks.com or register to post a comment.

New to Zacks?

Start Here

Zacks Investment Research

Close

Are you a new Zacks Member or a visitor to Zacks.com?

Top Zacks Features

My Portfolio Tracker

Is it Time to Sell?

One of the most important steps you can take today is to set up your portfolio tracker on Zacks.com. Once you do, you'll be notified of major events affecting your stocks and/or funds with daily email alerts.

More Zacks Resources

Zacks Rank Home - Evaluate your stocks and use the Zacks Rank to eliminate the losers and keep the winners.

Mutual Fund Rank Home - Evaluate your funds with the Mutual Fund Rank for both your personal and retirement funds.

Stock/Mutual Fund Screening - Find better stocks and mutual funds. The ones most likely to beat the market and provide a positive return.

My Portfolio - Track your Portfolio and find out where your stocks/mutual funds stack up with the Zacks Rank.

Zacks #1 Rank Top Movers for Zacks #1 Rank Top Movers

Company Symbol Price %Chg
UTD THERAPE… UTHR 117.83 +28.51%
TRIQUINT SE… TQNT 20.67 +6.52%
RF MICRO DE… RFMD 12.47 +6.04%
VASCO DATA… VDSI 14.77 +4.68%
BANCO DO BR… BDORY 15.53 +3.95%