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CVS: Analysts’ Ratings and Target Prices

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Nov. 8 2018, Updated 7:31 a.m. ET

Analysts’ ratings and target prices

CVS Health (CVS) posted stronger-than-expected third-quarter results on November 6. A few analysts raised the target prices on CVS stock. RBC increased its target price to $100 per share on CVS from $99. Meanwhile, Baird raised the target price to $77 from $73. Analysts have a consensus target price of $89.55 per share on CVS, which indicates an upside potential of 15.0% based on its closing price of $77.90 on November 6.

CVS is generating higher same-store sales. The company is benefiting from lower taxes. Management stated that it expects to close the Aetna deal before Thanksgiving—a positive step that will likely solidify its position in the pharmacy space.

Among the 23 analysts providing recommendations on CVS Health stock, 17 recommended a “buy,” while six recommended a “hold.” In comparison, most of the analysts covering Walgreens Boots Alliance (WBA) maintained a “neutral” outlook on the stock.

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Valuation summary

CVS stock is trading at a forward PE multiple of 10.8x, which is lower than Walgreens Boots Alliance. CVS stock is trading about 27% lower than its four-year historical average multiple of 14.8x. Walgreens Boots Alliance stock is trading at a forward PE multiple of 12.3x.

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