CVS/Aetna Has Solid Quarter Despite COVID Headwinds

CVS Health Corp., the parent company of health insurer Aetna, reported higher than expected profits in the second quarter of 2021. The pharmacy, health insurance and retail giant took in $2.42 in earnings per share, beating Wall Street’s estimated EPS of $2.07.

CVS reported $72.6 billion in overall revenue in the second quarter, an 11.1% increase from 2020. Citi analyst Ralph Giacobbe wrote in an Aug. 4 note to investors that the results were “well ahead” of the consensus projection of $70.2 billion in revenue.

CVS’s Health Care Benefits segment took in $20.53 billion in revenue in the second quarter, beating Wall Street projections of $19.95 billion, and yielding an adjusted operating income of $1.61 billion. That segment reported a medical loss ratio of 84.1%, in line with Wall Street’s expectations, according to Giacobbe, and CVS raised its full-year EPS projection from $7.56-$7.68 to $7.70-$7.80.

CEO Karen Lynch, who was head of Aetna before taking over the top job in February, said during an Aug. 4 conference call to discuss the company’s quarterly results that she has been pleased with the work CVS has done integrating the payer into its overall business.

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Peter Johnson

Peter Johnson

Peter has worked as a journalist since 2011 and has covered health care since 2020. At AIS Health, Peter covers trends in finance, business and policy that affect the health insurance and pharma sectors. For Health Plan Weekly, he covers all aspects of the U.S. health insurance sector, including employer-sponsored insurance, Medicaid managed care, Medicare Advantage and the Affordable Care Act individual marketplaces. In Radar on Drug Benefits, Peter covers the operations of (and conflicts between) pharmacy benefit managers and pharmaceutical manufacturers, with a particular focus on pricing dynamics and market access. Before joining AIS Health, Peter covered transportation, public safety and local government for various outlets in Seattle, his hometown and current place of residence. He graduated with a B.A. from Colby College.

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