CVS Health Higher on Dividend Boost, Solid 2024 Revenue Forecast

CVS Health, facing the potential for deeper industry consolidation, lifted its 2024 sales forecast and boosted its quarterly dividend.

CVS Health (CVS) - shares jumped higher Tuesday after the group boosted its quarterly dividend, while forecasting stronger-than-expected 2024 sales. The health-care and drugstore group looks to streamline its broader business amid renewed talk of consolidation in the health-insurance sector.

CVS sees overall revenue of at least $366 billion next year, firmly ahead of the LSEG forecast of around $346 billion, with adjusted profit coming in at around $8.51 per share. The group also reiterated its 2023 forecasts for adjusted profit in the region of $8.50 to $8.70 a share as well as cash flows from its overall business to come in between $12.5 billion to $13.5 billion.

In addition, CVS lifted its quarterly dividend by 10%, to 66.5 cents a share, payable Feb. 1 to holders of record Jan. 22.

CVS shares were marked 2.44% higher in premarket trading to indicate an opening bell price of $70.18 each, a move that would nudge the stock into positive territory for the past six months.

CVS rebrands health services division
The Woonsocket, Rhode Island-based group, one of the country's biggest pharmacy-benefits managers, also unveiled plans to rebrand its Health Services segment under the name CVS Healthspire. That division will include a host of its current units, including Oak Street Health, Signify and its MinuteClinic.

"Delivering care in a more integrated way — especially for complex patients with chronic health conditions — improves health outcomes and the patient experience," said Oak Street Health's interim president, Mike Pykosz.

Technical Analysis
CVS is trading near the bottom of its 52-week range and below its 200-day simple moving average. Investors have been pushing the share price lower, and the stock still appears to have downward momentum. This is a negative sign for the stock's future value.