To read the rest of the story Google..." Why Goldman Sachs Has Beefed Up Its Bullish Views On CVS Health"
Stock at CVS Health escalated nearly 35% in 2014, significantly outperforming the S&P 500’s gain of 12%. Mr. Jones considers exposure to CVS an attractive buy given its matchless leverage to key industry trends including Rx utilization and healthcare reform and restructure in the market. Goldman expects the specialty pharmacy chain to beat the Street’s estimates and deliver 15% growth in EPS in 2015-2017, which the firm believes will be realized from procurement savings aforementioned.
The firm feels that another factor that will drive in growth for the entire industry, and CVS in particular is the savings arising from consolidation of generic purchasing power, with which synergies are expected to come in at 4%. The firm is weighing in on CVS’s partnership with Cardinal Health Inc. which it believes will drive cost synergies and maintain margin improvements during the year.
CVS Health Corp. stock has been upgraded from Neutral to Buy/Attractive by Goldman Sachs Group Inc. On the grounds of unmatched leverage to Rx growth and procurement savings, Goldman Sachs analyst Robert P Jones sees immense upside to CVS earnings. Consequently, he has uplifted the target price on the stock from $95 to $113, depicting the stock potential to appreciate 14% from its current price.
For the current year, Goldman Sachs is increasingly optimistic about the performance of specialty drug retailers. The investment firm expects overall growth for the industry to clock in at 3.6% - much higher than the 2.4% growth posted in 2014. The firm also believes that the industry will benefit from increased Rx utilization as the size of an aging population increases. Besides, the government’s Affordable Care Act (ACA) also caused an increase in the number of individuals eligible for government healthcare benefits.
The firm feels that another factor that will drive in growth for the entire industry, and CVS in particular is the savings arising from consolidation of generic purchasing power, with which synergies are expected to come in at 4%. The firm is weighing in on CVS’s partnership with Cardinal Health Inc. (NYSE:CAH) which it believes will drive cost synergies and maintain margin improvements during the year.
With so many industry growth drivers, the investment firm believes drugstore chains are well positioned to outdo the headwinds coming from reimbursement pressure and will continue to post stellar growth in the quarters ahead. Keeping in mind the 2015 guidance provided by CVS, Goldman Sachs believes that margin pressure and generic drug inflation will already be manageable and not as detrimental as it was the past year.
Almost every analyst who follows CVS has a neutral or buy rating on CVS with Price targets higher than the current one. I bet a lot of them use the same models that you got your overbought condition from. FYI - those same analyst have been right about the stock for the past 4 years.
I don't agree...There are many long term investors who bought AAPL (post split) at $90 hoping that it will someday hit $600 again just like there would me many long term investors who would buy CVS at $50 hoping it will hit $100 again and people like you and me will benefit if CVS hit $100 again (post split) because we now have double the original shares we had ...again it's a win win and the benefit of a split outweighs the non benefit of a split. There is just no denying that fact.
News just out...shorts lose this round
A group of mortgage bond investors has sent Ocwen Financial Corp. a notice of non-performance in what could be the precursor toward a future lawsuit, according to a media report.
Citing an unnamed source, Reuters reported Friday afternoon that a number of major investors, including BlackRock, MetLife, and Pimco, filed a formal notice to Ocwen accusing the servicer of failing to properly collect payments on $82 billion of home loans.
In its notice, the group alleges improper loan modification practices, wrongfully recouped advances, and failure to account for cash flows, according to Reuters.
This is a developing story. Check again later for more details.
AAPL only did a split 6 months ago and it's only up 10% since then but lets see where Apple is in a year or two and how the stock is doing after the many buybacks and DIVI rises and then ask the shareholders if splitting was a good idea ...I bet the answer would be yes
CVS did a spit in 2005- stock price $29 - May 2007 CVS stock price $39.... You what fail to mention is those holders of CVS (pre split) have DOUBLE the amount of their original shares and are also collecting a dividend on those extra shares ... It's a win win That is how long terms wealth is built. The benefit of doing a spilt outweigh the no benefit.