CVS Health Corp (NYSE:CVS) reported first quarter results that beat Wall Street’s expectations, but the stock moved lower after the healthcare titan downwardly revised its full-year profit guidance.
The drugstore chain said it now expected adjusted earnings per share between $8.50 and $8.70 for full-year 2023, down from its earlier forecast of $8.70 to $8.90 and below the Street’s forecast per a FactSet survey of $8.76.
Likely behind its slashed guidance are the company’s two multi-billion-dollar acquisitions that closed in the first quarter: its roughly $10.6 billion takeover of primary care provider Oak Health and $7.8 billion acquisition of at-home care provider Signify Health.
"These additions are core to our strategy and will help unlock future growth as we push further into value-based care, which prioritizes keeping people healthy," said CVS CEO Karen S Lynch in a statement.
The company also noted a 2.8% hit to its operating income due to the write-down of its long-term care business Omnicare (NYSE:OCR).
In the first quarter, CVS reported an 11% jump in revenue from $76.8 billion to $85.3 billion, above the expected $80.8 billion.
Adjusted earnings per share came in at $2.20, down from $2.30 in the year-ago quarter but outperforming the Street’s expectation of $2.09.
CVS shares were trading down 2.4% at US$71 on Wednesday morning in New York.
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