CVS Earnings Cheat Sheet: Positive Quarter Doubles Free Cash Year Over Year

S&P 500 (NYSE:SPY) component CVS Caremark Corporation (NYSE:CVS) reported its results for the first quarter. CVS Caremark Corporation provides prescriptions and related health care services and products.

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CVS Caremark Earnings Cheat Sheet for the First Quarter

Results: Net income for the drug store fell to $712 million (52 cents/share) vs. $771 million (55 cents/share) a year earlier. A decline of 7.7% from the year earlier quarter.

Revenue: Rose 8.9% to $25.88 billion YoY.

Actual vs. Wall St. Expectations: CVS fell short of the mean analyst estimate of 55 cents/share. Estimates ranged from 54 cents per share to 56 cents per share.

Quoting Management: Larry Merlo, President and Chief Executive Officer, stated: “2011 is off to a good start, with results slightly above guidance for both our retail and PBM businesses. We also generated $1.6 billion in free cash this quarter, more than double the amount we generated in last year’s first quarter. Our retail business continues to grow and gain share, and our new store clustering initiatives are yielding promising results.”

Key Stats: A year-over-year revenue increase last quarter snaps a streak of three consecutive quarters of revenue declines. Revenue fell 4.1% in the fourth quarter of the last fiscal year, 3.1% in the third quarter of the last fiscal year and 3.5% in the second quarter of the last fiscal year.

Net income has dropped 6.7% year over year on average across the last five quarters. Performance was hurt by a 20.8% decline in the third quarter of the last fiscal year from the year earlier quarter.

Competitors to Watch: Walgreen Company (NYSE:WAG), Rite Aid Corporation (NYSE:RAD), PharMerica Corporation (NYSE:PMC), Medco Health Solutions Inc. (NYSE:MHS), drugstore.com, inc. (NASDAQ:DSCM), PetMed Express, Inc. (NASDAQ:PETS), Graymark Healthcare Inc (NASDAQ:GRMH), BioScrip Inc. (NASDAQ:BIOS), GNC Acquisition Hldgs. Inc (GNC), and Assured Pharmacy, Inc. (APHYD)

Stock Performance: Shares of CVS are trading at $35.94 as of May 5, 2011 at 8:55 AM ET, down .5% from the previous close.


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