CVS Health Corp. said it would re-enter the Affordable Care Act insurance marketplaces next year, as its major role in Covid-19 testing and vaccination allows it to forge ties to more consumers.
The pharmacy and insurance giant reported fourth-quarter results that beat Wall Street estimates and offered guidance for 2021 that, at the high end, matched analysts’ expectations. For 2021, CVS expects earnings per share of $6.06 to $6.22. It predicted adjusted earnings per share of $7.39 to $7.55, compared with the FactSet consensus of $7.54.
CVS said it anticipated the pandemic would have only an immaterial impact on its 2021 earnings. The company’s new chief executive officer, Karen Lynch, who previously led CVS’s Aetna insurance unit, said the company expected some deferred healthcare use in the first quarter before consumers likely “head back to a normal level of utilization” later in the year.
Shares of CVS were down nearly 5% at $70.69 in afternoon trading.
“In-line numbers, in-line guidance, no major surprises…Everything seems to be moving along solidly,” Matthew Borsch, an analyst with BMO Capital Markets, said of CVS’s financial performance.