CVS raises its earnings outlook for 2021 on higher demand for COVID-19 vaccines and testing, according to Reuters
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© Reuters. FILE PHOTO: Shelves filled with cigarettes are depicted in a CVS store in the Manhattan neighborhood of New York City on February 5, 2014. REUTERS / Carlo Allegri
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(Reuters) – CVS Health Corp. raised its 2021 earnings forecast on Tuesday, citing higher demand for COVID-19 vaccines and over-the-counter testing as infections rose in the United States as the Omicron variant spread rapidly.
Shares of the pharmaceutical chain operator rose nearly 2% to $ 107 at the start of trading.
The company said it now expects an adjusted earnings per share for 2021 between $ 8.33 and $ 8.38, compared to the previous forecast of $ 8.00.
Coronavirus vaccines, which are higher than expected in November and December, as well as an increase in demand for COVID-19 prescription testing in the last month of 2021, also contributed to the strong performance of the retail segment, CVS said.
The Rival Walgreens Boots Alliance (NASDAQ 🙂 Inc. last week raised its year-over-year profit growth forecast following similar comments.
CVS also said its health insurance unit performed better than expected despite higher cases of coronavirus, especially in the back half of the fourth quarter, as delayed elective procedures offset higher costs of COVID-19.
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