CVS Stock Is Tumbling. Lowered Range for Cash-Flow Guidance Unnerved Investors.

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CVS stock is falling after earnings.

Bryan Bedder/Getty Images for CVS Pharmacy

 

CVS Health

stock was falling after lowered cash-flow guidance overshadowed better-than-expected fourth-quarter earnings Wednesday.

The pharmacy chain reported fourth-quarter revenue of $76.6 billion, beating the FactSet consensus of $75.6 billion. Adjusted earnings per share were $1.98, which topped the FactSet consensus of $1.83.

But CVS trimmed the 2022 guidance for cash flow from operations to $12.0 billion-$13.0 billion from $12.5 billion to $13.0 billion. The company confirmed 2022 guidance for adjusted EPS of $8.10 to $8.30, and revenue guidance for $304 billion to $309 billion.

CVS told Barron’s in an email that it trimmed the low end of cash-flow guidance for 2022 “due to faster collection and some pull-forward of receivables” in 2021.

Shares are down 4.3% to $106.07 in Wednesday morning trading on a strong day for the broader market: the

S&P 500 index is up 1.2%.

In fact, the stock was the worst performer in the index Wednesday, and was on pace for largest percent decrease since Feb. 16, 2021, when it fell 4.96%, according to Dow Jones Market Data.

Fourth-quarter same-store sales in the pharmacy segment were up 8.8% from last year and same-store retail sales rose 12.3%. Both were bolstered by the company’s administration of 11 million Covid-19 vaccinations and 8 million tests over the three-month period. 

For the full year 2021, CVS administered more than 32 million COVID-19 tests and more than 59 million vaccines. Over 35% of COVID-19 vaccines in 2021 were administered during the fourth quarter, the company said on an earnings call with investors Wednesday morning.

The company said it plans to combine its segments including drugstores, its insurance business, Aetna, and pharmacy benefits provider Caremark to…

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