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.
CVS Q3 Earnings & Revenues Top Estimates, Stock Up in Pre-Market
Read MoreHide Full Article
Key Takeaways
CVS reported Q3 adjusted EPS of $2.09, up 30.6%, while revenues rose 5.4% to $108.40 billion.
CVS' Health Care Benefits and Health Services growth offset Pharmacy & Consumer Wellness revenue declines.
CVS raised 2026 adjusted EPS guidance to at least $8.20 and operating cash flow to $15.50 billion.
CVS Health Corporation (CVS - Free Report) reported third-quarter 2026 adjusted earnings per share (EPS) of $2.09, up 30.6% year over year. The metric surpassed the Zacks Consensus Estimate by 29.01%.
Revenues came in at $108.40 billion, which rose 5.4% year over year and beat the Zacks Consensus Estimate by 3.20%. The improvement was primarily driven by higher adjusted operating income in the Health Care Benefits segment, reflecting continued execution of its margin recovery plan.
Following the announcement, CVS shares climbed 1.9% in the pre-market session today.
Health Care Benefits revenues increased 2.4% year over year to $36.86 billion. Growth in the Government business supported the improvement, partially offset by the company's exit from the individual exchange business in 2026.
Health Services revenues climbed 9.5% to $53.96 billion. Growth was primarily driven by pharmacy drug mix and brand inflation, partially offset by continued pharmacy client price improvements.
CVS Health Corporation Price, Consensus and EPS Surprise
Pharmacy & Consumer Wellness revenues declined 2% to $35.50 billion. Regulatory-related price reductions, generic drug introductions and reimbursement pressure weighed on performance. These headwinds were partially offset by increased prescription volume, Rite Aid asset contributions and brand inflation.
CVS Health’s Margin Performance Improves
CVS Health’s gross profit, calculated as total revenues less cost of products sold and health care costs, came in at $14.90 billion, up 7.9% year over year. Gross margin expanded approximately 30 basis points (bps) year over year to 13.7%.
Operating income reached $3.57 billion compared to an operating loss of $3.21 billion in the prior-year quarter. The improvement reflected higher adjusted operating income across all operating segments and the absence of a $5.73 billion goodwill impairment charge recorded in the year-ago quarter. Operating margin improved approximately 640 bps to 3.3% from negative 3.1%.
Adjusted operating income rose 21.2% to $4.19 billion. Adjusted operating margin expanded approximately 50 bps to 3.9% despite operating expenses increasing marginally to $11.33 billion from $11.29 billion in the year-ago quarter.
CVS Health’s Liquidity and Capital Position Improve
CVS Health ended the third quarter with cash and cash equivalents of $11.74 billion, up from $8.45 billion at 2025-end. Long-term debt stood at $57.22 billion, down from $60.50 billion at the end of 2025.
Cumulative net cash provided by operating activities was $15.32 billion compared with $7.25 billion in the prior-year period.
CVS Health also paid $2.58 billion in dividends during the first nine months of 2026 and repaid $4.06 billion in long-term debt. Continued debt reduction and disciplined capital returns remain important watch items as the company advances its operating recovery.
CVS Raises 2026 Guidance on Improved Expectations
Management raised its full-year 2026 adjusted EPS guidance to at least $8.20 from the previous range of $7.90-$8.10. The Zacks Consensus Estimate expects 2026 adjusted EPS to be $8.02.
The company expects full-year revenues of at least $420 billion, up from its previous projection of at least $414 billion. The Zacks Consensus Estimate for the metric stands at $418.17 billion at present.
Operating cash flow guidance increased to at least $15.50 billion from at least $11.50 billion.
The revised outlook reflects improved expectations for Health Care Benefits and Pharmacy & Consumer Wellness. However, management maintained a cautious stance amid continued elevated medical cost trends and potential macroeconomic headwinds.
Our Take on CVS Stock
CVS Health delivered a strong third-quarter 2026 performance, with earnings and revenues surpassing their respective estimates. The Health Care Benefits segment benefited from improved underlying performance in the Government business, reflecting continued progress in its margin recovery plan. Health Services maintained solid revenue momentum, supported by a favorable pharmacy drug mix and brand inflation. Pharmacy & Consumer Wellness witnessed improved profitability, aided by core pharmacy strength and Rite Aid asset contributions. The upward revision to full-year earnings, revenue and operating cash flow guidance is encouraging.
Among the key developments, more than 69% of Aetna Medicare Advantage members are enrolled in 2027 plans rated four stars or higher. CVS Health also expanded its integrated GLP-1 weight management offerings, while its Health100 mobile application received DirectTrust accreditation. However, continued medical cost pressures, pharmacy reimbursement challenges and potential macroeconomic headwinds remain concerns.
CVS’ Zacks Rank & Key Picks
CVS Health currently carries a Zacks Rank #3 (Hold).
Bausch + Lomb, sporting a Zacks Rank #1 (Strong Buy) at present, posted third-quarter 2026 adjusted EPS of 34 cents, exceeding the Zacks Consensus Estimate by 61.91%. Revenues of $1.28 billion topped the Zacks Consensus Estimate by 0.14%. You can see the complete list of today’s Zacks #1 Rank stocks here.
BLCO has an estimated long-term earnings growth rate of 40.1% compared with the industry’s 13.5% growth. The company’s earnings outpaced estimates in three of the trailing four quarters and missed on one occasion, the average surprise being 21.67%.
Medpace, carrying a Zacks Rank #2 (Buy), reported third-quarter 2026 adjusted EPS of $4.84, which surpassed the Zacks Consensus Estimate by 8.76%. Revenues of $716 million beat the Zacks Consensus Estimate by 1.02%.
MEDP has an estimated long-term earnings growth rate of 14.3% compared with the industry’s 13.2% growth. The company outperformed earnings estimates in each of the trailing four quarters, the average surprise being 9.77%.
Intuitive Surgical, carrying a Zacks Rank #2 at present, posted third-quarter 2026 adjusted EPS of $3.00, exceeding the Zacks Consensus Estimate by 14.94%. Revenues of $3.05 billion topped the Zacks Consensus Estimate by 5.84%.
ISRG has an earnings yield of 2.5% against the industry’s negative 2.1% yield. The company’s earnings outpaced estimates in each of the trailing four quarters, the average surprise being 15.12%.
View the Zacks #1 Rank List
Image: Bigstock
CVS Q3 Earnings & Revenues Top Estimates, Stock Up in Pre-Market
Key Takeaways
CVS Health Corporation (CVS - Free Report) reported third-quarter 2026 adjusted earnings per share (EPS) of $2.09, up 30.6% year over year. The metric surpassed the Zacks Consensus Estimate by 29.01%.
Revenues came in at $108.40 billion, which rose 5.4% year over year and beat the Zacks Consensus Estimate by 3.20%. The improvement was primarily driven by higher adjusted operating income in the Health Care Benefits segment, reflecting continued execution of its margin recovery plan.
Following the announcement, CVS shares climbed 1.9% in the pre-market session today.
CVS' Segment Performance Shows Mixed Revenue Trends
Health Care Benefits revenues increased 2.4% year over year to $36.86 billion. Growth in the Government business supported the improvement, partially offset by the company's exit from the individual exchange business in 2026.
Health Services revenues climbed 9.5% to $53.96 billion. Growth was primarily driven by pharmacy drug mix and brand inflation, partially offset by continued pharmacy client price improvements.
CVS Health Corporation Price, Consensus and EPS Surprise
CVS Health Corporation price-consensus-eps-surprise-chart | CVS Health Corporation Quote
Pharmacy & Consumer Wellness revenues declined 2% to $35.50 billion. Regulatory-related price reductions, generic drug introductions and reimbursement pressure weighed on performance. These headwinds were partially offset by increased prescription volume, Rite Aid asset contributions and brand inflation.
CVS Health’s Margin Performance Improves
CVS Health’s gross profit, calculated as total revenues less cost of products sold and health care costs, came in at $14.90 billion, up 7.9% year over year. Gross margin expanded approximately 30 basis points (bps) year over year to 13.7%.
Operating income reached $3.57 billion compared to an operating loss of $3.21 billion in the prior-year quarter. The improvement reflected higher adjusted operating income across all operating segments and the absence of a $5.73 billion goodwill impairment charge recorded in the year-ago quarter. Operating margin improved approximately 640 bps to 3.3% from negative 3.1%.
Adjusted operating income rose 21.2% to $4.19 billion. Adjusted operating margin expanded approximately 50 bps to 3.9% despite operating expenses increasing marginally to $11.33 billion from $11.29 billion in the year-ago quarter.
CVS Health’s Liquidity and Capital Position Improve
CVS Health ended the third quarter with cash and cash equivalents of $11.74 billion, up from $8.45 billion at 2025-end. Long-term debt stood at $57.22 billion, down from $60.50 billion at the end of 2025.
Cumulative net cash provided by operating activities was $15.32 billion compared with $7.25 billion in the prior-year period.
CVS Health also paid $2.58 billion in dividends during the first nine months of 2026 and repaid $4.06 billion in long-term debt. Continued debt reduction and disciplined capital returns remain important watch items as the company advances its operating recovery.
CVS Raises 2026 Guidance on Improved Expectations
Management raised its full-year 2026 adjusted EPS guidance to at least $8.20 from the previous range of $7.90-$8.10. The Zacks Consensus Estimate expects 2026 adjusted EPS to be $8.02.
The company expects full-year revenues of at least $420 billion, up from its previous projection of at least $414 billion. The Zacks Consensus Estimate for the metric stands at $418.17 billion at present.
Operating cash flow guidance increased to at least $15.50 billion from at least $11.50 billion.
The revised outlook reflects improved expectations for Health Care Benefits and Pharmacy & Consumer Wellness. However, management maintained a cautious stance amid continued elevated medical cost trends and potential macroeconomic headwinds.
Our Take on CVS Stock
CVS Health delivered a strong third-quarter 2026 performance, with earnings and revenues surpassing their respective estimates. The Health Care Benefits segment benefited from improved underlying performance in the Government business, reflecting continued progress in its margin recovery plan. Health Services maintained solid revenue momentum, supported by a favorable pharmacy drug mix and brand inflation. Pharmacy & Consumer Wellness witnessed improved profitability, aided by core pharmacy strength and Rite Aid asset contributions. The upward revision to full-year earnings, revenue and operating cash flow guidance is encouraging.
Among the key developments, more than 69% of Aetna Medicare Advantage members are enrolled in 2027 plans rated four stars or higher. CVS Health also expanded its integrated GLP-1 weight management offerings, while its Health100 mobile application received DirectTrust accreditation. However, continued medical cost pressures, pharmacy reimbursement challenges and potential macroeconomic headwinds remain concerns.
CVS’ Zacks Rank & Key Picks
CVS Health currently carries a Zacks Rank #3 (Hold).
Some better-ranked stocks from the broader medical space are Bausch + Lomb (BLCO - Free Report) , Medpace (MEDP - Free Report) and Intuitive Surgical (ISRG - Free Report)
Bausch + Lomb, sporting a Zacks Rank #1 (Strong Buy) at present, posted third-quarter 2026 adjusted EPS of 34 cents, exceeding the Zacks Consensus Estimate by 61.91%. Revenues of $1.28 billion topped the Zacks Consensus Estimate by 0.14%. You can see the complete list of today’s Zacks #1 Rank stocks here.
BLCO has an estimated long-term earnings growth rate of 40.1% compared with the industry’s 13.5% growth. The company’s earnings outpaced estimates in three of the trailing four quarters and missed on one occasion, the average surprise being 21.67%.
Medpace, carrying a Zacks Rank #2 (Buy), reported third-quarter 2026 adjusted EPS of $4.84, which surpassed the Zacks Consensus Estimate by 8.76%. Revenues of $716 million beat the Zacks Consensus Estimate by 1.02%.
MEDP has an estimated long-term earnings growth rate of 14.3% compared with the industry’s 13.2% growth. The company outperformed earnings estimates in each of the trailing four quarters, the average surprise being 9.77%.
Intuitive Surgical, carrying a Zacks Rank #2 at present, posted third-quarter 2026 adjusted EPS of $3.00, exceeding the Zacks Consensus Estimate by 14.94%. Revenues of $3.05 billion topped the Zacks Consensus Estimate by 5.84%.
ISRG has an earnings yield of 2.5% against the industry’s negative 2.1% yield. The company’s earnings outpaced estimates in each of the trailing four quarters, the average surprise being 15.12%.