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  • cmc587 cmc587 Jun 4, 2010 11:40 AM Flag

    A PBM or Retail Pharmy?

    Last November there were posts and news reports from significantly credible sources that CVS was the "WORST PERFORMING" BIG CAP STOCK-2009. There was quite a bit of dialog over these posts so go back and review the November time frame. I think bashersuit also added later that "CVS rallied off its mid November "Big Board Worst" and "did not close the year WORST." I am certain he is correct. There was only one subsequent verification on "The Street" stating that CVS was "ONE OF THE 2009 WORST" but not "the WORST." CVS's 2010 performance speaks for itself. I suggest that you contact either of the two large participating funds and see if you can "weasel from them" what they are selling...and maybe even why. I was told CVS was "somewhat out of favor" due to "jobs/economy/poor Caremark synergy." Remember, the CVS/CMX business plan has not been affirmed as Caremark has lost billions in business and the Fed is furthermore challenging the manner in which CVS is using Caremark. NOT GOOD! This is why CVS underperforms the PBM on the up side and is worse on the down side... and has done so consistently since the merger. On the retail side, WAG has "been in favor" and "out of favor" like a fast moving yo-yo. I said before and will reiterate, Duane Reade represents a huge error for WAG. I see no way WAG can maintain a battery of randonly situate NYC retail operations, no two of which are alike (yes, this latter comment is a slight exaggeration). Nonetheless, CVS has underperformed WAG or not even participated in WAG positive news on the upside but has been dragged down by WAG's bad news. Sometimes, WAG has a "bad announcement" and CVS actual performs worse. Yesterday and today are cases in point. WAG announces poorly yet ESRX and MHS have very stong results...CVS follows WAG down. Today, ESRX and MHS are down...but, look at the two day totals. I believe you and connie are "the same" so let me add this for her: "if I could, I would...CVS is a bad place to be now." WAG is about to hit the wall on June 22 and, likely, it will drag CVS with it. WAG will once again be off 25-30% well within a year. Shorting on the two are piling up. Without positive PBM news, what do you think happens to CVS? CVS MUST HAVE A "BIG PBM WIN" and there is nothing else that will do. CVS will underperform the sector, subsector and indices without that win...whether all go up or down. Just look at the charts. CVS is no longer considered a PBM and has become a "WAGGIE SIAMESE ON BAD NEWS ONLY"... like it or not. I DON'T. But my basis is next to zero. I do have limit's set and in place. One other thing, I do recall reading that of all the heathcare stocks, none trade down on a daily basis as much as CVS. Just keep rooting for that PBM win and a PBM attachment as opposed to a WAG one. If it hits, CVS moves up on its own. Right now, CVS has NO STRENGTH OF IT'S OWN. It trades like a feather in the wind attached to WAGs coat-tail only on negative news. If WAG is positive, CVS does not have a like reflection. Look it up. Go CVS- get that PBM win soon. craig

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