Fri, Jan. 23, 8:34 AM| 6 Comments
Wed, Jan. 21, 8:31 AM
- Stephens initiates coverage on CVS Health (NYSE:CVS) with an Overweight rating.
- The company also landed an upgrade from Goldman Sachs to Buy from Neutral and price target boost to $113.
- The general consensus on CVS is that there is more upside for pharmacy sales and that store traffic trends have improved in January.
Tue, Jan. 20, 10:56 AM
- The Supreme Court passes on hearing a case over the level of swipe fees charged by banks to retailers.
- The cap on swipe fees will stand at $0.21-$0.24 following the high court decision.
- Intense lobbying from the financial services industry prompted the Fed to move off its original recommendation for a $0.12 cap.
- The National Retail Federation and other consumer groups have vowed to keep the fight going.
- Related stocks: V, MA, WMT, TGT, BBY, CVS, WBA, COST, HD, LOW, GPS, M.
Wed, Jan. 14, 7:32 AM
- Shares of CVS Health (NYSE:CVS) are on watch after the stock was recommended on CNBC's Fast Money program.
- Karen Finerman sees a quick move to $100 for CVS as investors buy into the company's strong underlying growth story.
- CVS has never cracked the $100 level.
- Also leaning to the bullish side, SA contributor Jeroen Jongbloed thinks CVS has room to lift its dividend payout even higher.
Sun, Jan. 11, 10:44 AM
- The better-than-expected round of reports on holiday sales in the retail sector has improved the outlook on the profitability of chain stores, according to RetailDive.
- Teen Retailers: Out with dark lighting and logo-centric marketing and in with fast-fashion and online fulfillment. American Eagle Outfitters (NYSE:AEO), Aeropostale (NYSE:ARO), and Abercrombie & Fitch (NYSE:ANF) are finally pulling the right levers, according to analysts. Deb's Shops, Delia's, and possibly Wet Seal (NASDAQ:WTSL) won't be around to make the transition. It's Hail Mary time at American Apparel (NYSEMKT:APP).
- Department stores/specialty apparel: Smaller store counts and restructuring initiatives could be the theme in 2015 as mall traffic stays weak. RetailDive doesn't discount turnarounds at Sears Holdings (NASDAQ:SHLD) and J.C. Penney (NYSE:JCP). Gap (NYSE:GPS), Macy's (NYSE:M), and Urban Outfitters (NASDAQ:URBN) are viewed as ahead of the curve in setting their new agenda in place. Soft early comp compares and lower cotton prices could help lift Zumiez (NASDAQ:ZUMZ), Ann (NYSE:ANN), L Brands (NYSE:LB), Pacific Sunwear (NASDAQ:PSUN), and Express (NYSE:EXPR).
- Drugstores 2.0: Significant changes in the sector have given Walgreen Boots Alliance (NASDAQ:WBA), CVS Health (NYSE:CVS), and Rite Aid (NYSE:RAD) the room to grab more market share in healthcare and grocery. A much worse flu season in the U.S. than a year ago has helped the group get off to a good start.
- Previously: Holiday retail sales something of a revelation (Jan. 8)
Mon, Jan. 5, 12:57 PM
- CVS Health (CVS -1.3%) bestows Preferred Status to Gilead Sciences' (GILD +2.3%) Sovaldi (sofosbuvir) and Harvoni (ledipasvir/sofosbuvir) for the treatment of HCV infection. The pills will be the exclusive treatment option for beneficiaries on CVS's Medicare, Medicaid and other drug benefit plans. AbbVie's (ABBV -2.9%) Viekira Pak will be available only via a medical exception or prior authorization. Recently, AbbVie announced a similar deal with Express Scripts.
- Previously: AbbVie's new hepatitis C drug gets boost (Dec. 22, 2014)
Dec. 20, 2014, 10:17 AM
- The S&P Retail ETF (NYSEARCA:XRT) is up 3.4% over the last month to outpace the S&P 500 Index as consumer spending trends improve. Analysts have honed in on some categories which show some promise for growth.
- Drugstores: The transition by the sector into more health/wellness services sets it up for new growth channels. CVS Health (NYSE:CVS) reported strong comparable-store sales despite the full tobacco exit, while Rite Aid (NYSE:RAD) is prepping for a roll-out of RediClinics and HealthSpot kiosks. The visibility on Walgreen (NYSE:WAG) is somewhat clouded by the giant Alliance Boots integration, although it's ahead of rivals on the tech front with its rewards program, pharmacy app and developing online doctor concept.
- Athleisure: There's some gender initiatives going on in the athletic apparel sector with Under Armour (NYSE:UA) and Nike (NYSE:NKE) growing their women's business and Lululemon (NASDAQ:LULU) expanding on the men's side. All three companies have been closely on-trend with their assortment in a category with explosive demand. Importantly, pricing has held up this holiday season in the U.S., note retail watchers.
- Online replenishing: Fresh research into shopping trends indicates certain categories see continued buying through the online channel as consumers become attuned to a brand. Retailers positioned well to see more gains from the trend include Williams-Sonoma (NYSE:WSM), Ulta Beauty (NASDAQ:ULTA), Staples (NASDAQ:SPLS), Office Depot (NASDAQ:ODP), Sephora (OTCPK:LVMHF), Dick's Sporting Goods (NYSE:DKS), and of course Amazon (NASDAQ:AMZN).
- P-E buyouts: There are plenty of candidates in the retail sector for a leveraged buyout similar to the action that helped propel shares of PetSmart (NASDAQ:PETM) +40% from their lows. Keep an eye on Abercrombie & Fitch (NYSE:ANF), Aeropostale (NYSE:ARO), and Ann (NYSE:ANN).
Dec. 19, 2014, 7:53 AM
- SunTrust Robinson Humphrey upgrades CVS Health (NYSE:CVS) to a Buy rating from Neutral.
- The investment firm has a price target of $110 on the drugstore chain.
- What to watch: A strong report from CVS management at its Analyst Day last week has drawn notice from the Street. Also of note, the company doesn't appear to be showing any immediate side effects from its tobacco exit.
Dec. 17, 2014, 7:32 AM
Dec. 16, 2014, 7:42 AM
- CVS Health (NYSE:CVS) approves a new $10B share buyback program on top of a quarterly dividend boost to $0.35/share.
- The company sees FY15 EPS of $5.05-$5.19 vs. $5.11 consensus.
- Free cash flow of $5.9B to $6.2B is expected to be generated next year.
- CVS +0.2% premarket.
Dec. 11, 2014, 9:30 AM
- Retail sales struck their biggest gain since March on broad strength.
- What's working: Strong growth was seen in auto parts (PBY, ORLY, AZO, AAP, MNRO) with the broad parts category showing year-over-year sale growth of over 8% in November. Sales were up 6.8% Y/Y for health and personal care stores (ULTA, SBH, CVS, WAG, RAD) during the month.
- What's not working: Department stores (DDS, M, SSI, BONT, SHLD, JCP, KSS, JWN) went backwards with sales off 1.1% from a year ago. No surprise, but sales at gas stations (CASY, KR, PTRY) also fell off from a year ago.
- Retail ETFs: XLY, XRT, VCR, RTH, RETL, IYK, FXD, IYC, FDIS, SCC, UCC, PMR, UGE, RCD, SZK.
Nov. 25, 2014, 8:18 AM
- Pharmacy benefits manager Express Scripts (NASDAQ:ESRX) is at the forefront of an increasing wave of resistance to the high prices of new drugs from pharma and biotech firms, some which cost as much as $50K per month. Pharmaceutical spending in the U.S. is $270B and may breach $500B in five years. ESRX's method of controlling costs is to refuse to pay for them. For 2015, for example, it is excluding 66 branded drugs from its main formulary, an increase of 18 from 2014's 48. On the list is Johnson & Johnson's (NYSE:JNJ) rheumatoid arthritis drug Simponi (golimumab) which costs $3K per month.
- Other prescription benefits managers are employing similar tactics. CVS Health (NYSE:CVS) will exclude 95 drugs from its 2015 formulary including Pfizer's (NYSE:PFE) multiple sclerosis med Rebif (interferon beta-1a) which costs $5K for a four-week supply.
- Governments are pushing back as well. Among 42 state Medicaid programs, 27 pay for Gilead Sciences' HCV med Sovaldi (sofosbuvir) only for patients with severe liver damage while others impose coverage limitations for patients with recent substance-abuse problems. In the U.S., the full regimen cost is $84K. Recently, Britain's National Institute for Health and Care Excellence (NICE) balked at recommending reimbursement for Roche's (OTCQX:RHHBY) blood cancer drug Gazyvaro (obinutuzumab).
- Ninety percent of commercial health plans require pre-approval of specialty drugs, up from 82% in 2011.
- Previously: Roche's Gazyvaro not NICE in the UK
- Previously: Global drug tab will breach trillion dollar mark this year
- ETFs: IBB, BIB, IRY, BIS, IXJ, DRGS
- Related tickers: (NYSE:NVS) (NYSE:AZN) (NASDAQ:AMGN) (NASDAQ:BIIB) (NASDAQ:CELG) (NYSE:LLY) (NYSE:SNY) (NYSE:ABT) (NYSE:ABBV) (NYSE:BMY) (NYSE:MRK) (NYSE:GSK)
Nov. 4, 2014, 8:08 AM
- CVS Health (NYSE:CVS) Q3 results ($M): Revenues: 35,021 (+10%); Gross Profit: 6,468 (+7%); Operating Income: 2,246 (+4%); Net Income: 948 (-24%); EPS: 0.81 (-21%); Quick Assets: 1,210 (-71%); CF Ops (9 mo.): 4,714 (+11%).
- 2014 Guidance: non-GAAP EPS: $4.47 - 4.50 from $4.43 - 4.51; GAAP EPS from continuing operations: $3.93 - 3.96; CF Ops: $7.4B - 7.7B from $7.2B - 7.5B, Free Cash Flow $5.7B - 6.0B from $5.5B - 5.8B.
- Q4 Guidance: non-GAAP EPS: $1.18 - 1.21; GAAP EPS from continuing ops: $1.12 - 1.15.
- Shares up 1% premarket on light volume.
Nov. 4, 2014, 7:05 AM
Nov. 3, 2014, 5:30 PM
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Oct. 29, 2014, 1:42 PM
- Walgreen (WAG -1.2%) has taken to social media to tell iPhone 6 and 6 Plus owners that Apple Pay is accepted at all of the drugstore chain's stores.
- Rivals Rite Aid (RAD +3.7%) and CVS Caremark (CVS -0.2%) don't accept payments through the Apple app as they wait for a competing mobile payments system called CurrentC to be introduced next year.
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