CVS Health (ticker: CVS) experienced a decline in its stock prices on Wednesday, despite reporting solid earnings and revenue that surpassed analysts’ expectations. The healthcare company has also lowered its full-year guidance for the third consecutive quarter, resulting in significant disappointment among investors.
Impressive Financial Performance
CVS reported earnings of $2.21 per share, with a revenue of $89.8 billion. These figures exceeded the projected earnings of $2.13 per share, based on analysts surveyed by FactSet. The company showcased a remarkable financial performance, defying initial estimates.
Lowered Guidance for Earnings
Although CVS showcased impressive financial results, it revised its guidance range for diluted earnings per share under U.S. Generally Accepted Accounting Principles (GAAP). The company now expects earnings in the range of $6.37 to $6.61 per share. In February, CVS predicted earnings of $7.73 to $7.93 per share for 2023. However, these expectations were revised downwards in May and August.
Market Response
Following the announcement, shares in CVS fell by 1% during premarket trading on Wednesday. The market’s reaction indicates investors’ concern over the company’s lowered guidance for future earnings.