We use cookies to understand how you use our site and to improve your experience.
This includes personalizing content and advertising.
By pressing "Accept All" or closing out of this banner, you consent to the use of all cookies and similar technologies and the sharing of information they collect with third parties.
You can reject marketing cookies by pressing "Deny Optional," but we still use essential, performance, and functional cookies.
In addition, whether you "Accept All," Deny Optional," click the X or otherwise continue to use the site, you accept our Privacy Policy and Terms of Service, revised from time to time.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
Here's How CVS' Health Services Arm Is Positioned for Long-Term Growth
Read MoreHide Full Article
Key Takeaways
CVS Health Services revenues rose 11.5% to $51.8B in Q2 2026 as adjusted operating income climbed 10%.
Caremark's 2026 selling season generated over $6B in new sales, well above its historical average.
Health Care Delivery revenues jumped nearly 23%, led by Oak Street Health as CVS refines clinic economics.
CVS Health’s (CVS - Free Report) Health Services business continues to benefit from favorable pharmacy drug mix, brand inflation, purchasing economics and gradual improvement in Health Care Delivery. In the second quarter of 2026, the segment’s revenues increased 11.5% year over year to $51.80 billion, while adjusted operating income rose 10% to $1.73 billion.
The company reiterated its full-year 2026 adjusted operating income outlook despite updating its view of the 340B program, supported by performance across the broader Pharmacy Services business. Caremark continues to adapt its offerings as clients seek lower net costs and greater transparency. The 2026 selling season generated more than $6 billion in new sales, well above the company’s historical average. CVS Specialty also maintained adherence levels above 90%, while Caremark’s Humira biosimilar strategy has delivered more than $1.8 billion in client savings.
Health Care Delivery is also contributing to growth, with second-quarter 2026 revenues rising nearly 23% year over year, primarily driven by Oak Street Health. CVS is making technology infrastructure changes, refining payer contracts and adopting a more selective clinic footprint to improve the economics of Health Care Delivery over time.
Peer Update
UnitedHealth’s (UNH - Free Report) health service business, branded as Optum, remains a central growth engine and a key pillar of diversification. Despite the temporary disruption from the Change Healthcare cyberattack in February 2024, its revenues rose 11.6% in 2024 and 7% in 2025, reaching $129.4 billion in the first half of 2026.
Growth continues to be supported by OptumHealth’s integrated value-based care model and investments in AI-enabled technologies. Optum Insight is also gaining traction with AI-driven solutions, while Optum Rx continues to advance its transparency initiatives. These efforts could support longer-term growth and margin expansion.
Elevance Health (ELV - Free Report) continues to expand its healthcare services brand Carelon’s integrated healthcare capabilities across pharmacy, behavioral health and value-based care solutions. During the first half of 2026, Carelon revenues increased 7.1% year over year to $37.2 billion, driven by Carelon Services risk-based solutions and CarelonRx product revenues.
ELV highlighted the expansion of CareBridge, growth in external client relationships and the development of additional value-based solutions as strategic priorities. These initiatives could broaden Elevance’s role beyond traditional health insurance and support future revenue diversification.
CVS’ Price Performance, Valuation and Estimates
Over the past year, CVS Health shares have risen 30.1% compared with the industry’s 13.7% growth.
Image Source: Zacks Investment Research
CVS shares are trading at a forward five-year price-to-sales ratio of 0.29, lower than the industry average of 0.53. The stock has a Value Score of A.
Image Source: Zacks Investment Research
The consensus estimate for the company’s 2026 earnings has been showing a bullish trend.
View the Zacks #1 Rank List
Image: Bigstock
Here's How CVS' Health Services Arm Is Positioned for Long-Term Growth
Key Takeaways
CVS Health’s (CVS - Free Report) Health Services business continues to benefit from favorable pharmacy drug mix, brand inflation, purchasing economics and gradual improvement in Health Care Delivery. In the second quarter of 2026, the segment’s revenues increased 11.5% year over year to $51.80 billion, while adjusted operating income rose 10% to $1.73 billion.
The company reiterated its full-year 2026 adjusted operating income outlook despite updating its view of the 340B program, supported by performance across the broader Pharmacy Services business. Caremark continues to adapt its offerings as clients seek lower net costs and greater transparency. The 2026 selling season generated more than $6 billion in new sales, well above the company’s historical average. CVS Specialty also maintained adherence levels above 90%, while Caremark’s Humira biosimilar strategy has delivered more than $1.8 billion in client savings.
Health Care Delivery is also contributing to growth, with second-quarter 2026 revenues rising nearly 23% year over year, primarily driven by Oak Street Health. CVS is making technology infrastructure changes, refining payer contracts and adopting a more selective clinic footprint to improve the economics of Health Care Delivery over time.
Peer Update
UnitedHealth’s (UNH - Free Report) health service business, branded as Optum, remains a central growth engine and a key pillar of diversification. Despite the temporary disruption from the Change Healthcare cyberattack in February 2024, its revenues rose 11.6% in 2024 and 7% in 2025, reaching $129.4 billion in the first half of 2026.
Growth continues to be supported by OptumHealth’s integrated value-based care model and investments in AI-enabled technologies. Optum Insight is also gaining traction with AI-driven solutions, while Optum Rx continues to advance its transparency initiatives. These efforts could support longer-term growth and margin expansion.
Elevance Health (ELV - Free Report) continues to expand its healthcare services brand Carelon’s integrated healthcare capabilities across pharmacy, behavioral health and value-based care solutions. During the first half of 2026, Carelon revenues increased 7.1% year over year to $37.2 billion, driven by Carelon Services risk-based solutions and CarelonRx product revenues.
ELV highlighted the expansion of CareBridge, growth in external client relationships and the development of additional value-based solutions as strategic priorities. These initiatives could broaden Elevance’s role beyond traditional health insurance and support future revenue diversification.
CVS’ Price Performance, Valuation and Estimates
Over the past year, CVS Health shares have risen 30.1% compared with the industry’s 13.7% growth.
Image Source: Zacks Investment Research
CVS shares are trading at a forward five-year price-to-sales ratio of 0.29, lower than the industry average of 0.53. The stock has a Value Score of A.
Image Source: Zacks Investment Research
The consensus estimate for the company’s 2026 earnings has been showing a bullish trend.
Image Source: Zacks Investment Research
CVS currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.