CVS Health reported strong fourth-quarter earnings despite rising insurance costs, beating Wall Street’s estimates by a wide margin. The company earned $1.64 billion, or $1.30 per share, for the period ended Dec. 31, surpassing analyst predictions of 89 cents per share.
Rising medical costs and lower Medicare Advantage star ratings contributed to the shortfall from last year’s earnings of $2.05 billion, or $1.58 per share. CVS attributed the decrease to increased pressure on its Medicaid coverage in several states and rising costs from its Medicare Advantage business.
On the retail side, CVS Health is wrapping up a multi-year plan to close over 1,100 stores, with quarterly revenue totaling $97.71 billion. The company forecasts full-year adjusted earnings in a range of $5.75 to $6 per share.
CVS’s stock price surged over 11% before the market opened on Wednesday following the earnings release. Despite a rough 2024 marked by forecast cuts and a stock price decline, the company is trying to move forward under new leadership. Former CEO Karen Lynch stepped down in October and was replaced by David Joyner, while four new board members were added in November, including Glenview Capital Management’s CEO, who has criticized the company for operating below its potential.
Source: https://abcnews.go.com/Business/wireStory/cvs-health-steers-rising-insurance-costs-strong-fourth-118730275