Executive Summary

• CVS reported 3Q16 adjusted EPS of $1.64, up 28.0% year over year and beating the $1.57 consensus estimate. Revenues were $44.6 billion, up 15.5% year over year, missing the $45.3 billion consensus estimate.
• Pharmacy Services was the fastest-growing segment, with revenues up 19.2% year over year, to $30.4 billion; revenues in the Retail/Long-Term Care (LTC) segment grew by 12.5%.
• The company reduced and narrowed its 2016 adjusted EPS guidance range to $5.77–$5.83 from $5.81–$5.89. Preliminary 2017 adjusted EPS guidance is $5.77–$5.93, below the consensus estimate of $6.53.