Pharmacy retailer-cum-benefits manager CVS Caremark
CVS steps it up
CVS's revenues have improved as a result of its long-term contract with Aetna
CVS has tried to boost flagging front-end sales by opening new stores, which should add to the top line. In addition to recently opening 41 new stores, taking its total store count up to 7,266, it also recently entered a deal to provide mail-order pharmacy services to more than 5 million U.S. federal employees, retirees, and dependents.
Is the price right?
Let's see how the company is valued compared with its industry peers.
Company |
Trailing P/E |
Forward P/E |
TEV/FCF |
---|---|---|---|
CVS Caremark | 13.68 | 10.55 | 12.75 |
Rite-Aid | N/A* | N/A* | N/A* |
Walgreen | 12.81 | 9.87 | 12.47 |
Sources: Yahoo! Finance and Capital IQ, a division of Standard & Poor's.
* Negative earnings/and or free cash flow.
Looking at the P/E and enterprise-value-to-free-cash-flow ratio (TEV/FCF), we see that CVS is valued more-or-less in line Walgreen. The gap between its current and forward P/E means that analysts expect a lot of growth from the company over the coming year. But with Express Scripts
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