CVS lifts 2021 profit view on higher demand for COVID-19 vaccinations, tests

Shelves full of cigarettes are pictured at a CVS store in the Manhattan borough of New York

(Reuters) -CVS Health Corp on Tuesday raised its 2021 earnings forecast, citing higher demand for COVID-19 vaccinations and over-the-counter testing as infections in the United States soared due to the fast-spreading Omicron variant.

Shares in the drugstore chain operator were up nearly 2% at $107 in early trading.

The company said it now expects adjusted profit per share for 2021 in the range of $8.33 to $8.38, up from a prior forecast of $8.00.

Higher-than-expected coronavirus vaccinations in November and December, as well as elevated demand for over-the-counter COVID-19 testing in the last month of 2021, helped with a strong retail segment performance, CVS said.

Rival Walgreens Boots Alliance Inc last week raised its full-year adjusted profit growth forecast on the back of similar comments.

CVS also said its health insurance unit performed better than expected despite higher coronavirus cases, particularly in the back half of the fourth quarter, as deferred elective procedures offset higher COVID-19 costs.

(Reporting by Ankur Banerjee and Manojna Maddipatla in Bengaluru; Editing by Ramakrishnan M.)