4 Reasons CVS Health Is a Promising Value Pick
The year 2020 may have been one of Wall Street's craziest. Many technology stocks saw a dramatic increase in share prices, and many mature companies reported lackluster share price performance.
CVS Health (NYSE: CVS), a leading pharmacy benefit manager (PBM) with broad retail pharmacy presence and the operator of a health insurance provider (Aetna), has already lost about one-fourth of its market value in 2020.
Investors are concerned about the potential impact of tomorrow's U.S. presidential election, in which a Democratic win might mean big changes to drug prices and PBM margins. CVS Health is also burdened with total debt of over $92 billion, much of which came from the $69 billion Aetna acquisition completed in November 2018. A reduction in retail pharmacy visits during the first half of fiscal 2020 affected front-store sales, which usually include high-margin products such as cosmetics and other consumables. Overall market sentiment has also turned for the worse in recent weeks, as the U.S. continues to battle the ongoing surge in COVID-19 infections.
Source Fool.com
