A notable insider purchase on May 19, was reported by J. Scott Kirby, Director at CVS Health CVS, based on the most recent SEC filing.
What Happened: Kirby made a significant move by purchasing 2,769 shares of CVS Health as reported in a Form 4 filing with the U.S. Securities and Exchange Commission. The transaction’s total worth stands at $167,441.
During Tuesday’s morning session, CVS Health shares up by 1.1%, currently priced at $63.47.
About CVS Health
CVS Health offers a diverse set of healthcare services. Its roots are in its retail pharmacy operations, where it operates over 9,000 stores primarily in the US. CVS is also a large pharmacy benefit manager (acquired through Caremark), processing about 2 billion adjusted claims annually. It also operates a top-tier health insurer (acquired through Aetna) where it serves about 27 million medical members. The company’s recent acquisition of Oak Street adds primary care services to the mix, which could have significant synergies with all existing business lines.
CVS Health: Financial Performance Dissected
Revenue Growth: CVS Health’s revenue growth over a period of 3 months has been noteworthy. As of 31 March, 2025, the company achieved a revenue growth rate of approximately 6.96%. This indicates a substantial increase in the company’s top-line earnings. As compared to competitors, the company encountered difficulties, with a growth rate lower than the average among peers in the Health Care sector.
Key Insights into Profitability Metrics:
-
Gross Margin: The company shows a low gross margin of 15.22%, indicating concerns regarding cost management and overall profitability relative to its industry counterparts.
-
Earnings per Share (EPS): The company excels with an EPS that surpasses the industry average. With a current EPS of 1.41, CVS Health showcases strong earnings per share.
Debt Management: CVS Health’s debt-to-equity ratio stands notably higher than the industry average, reaching 1.06. This indicates a heavier reliance on borrowed funds, raising concerns about financial leverage.
Valuation Analysis:
-
Price to Earnings (P/E) Ratio: With a lower-than-average P/E ratio of 14.98, the stock indicates an attractive valuation, potentially presenting a buying opportunity.
-
Price to Sales (P/S) Ratio: The P/S ratio of 0.21 is lower than the industry average, implying a discounted valuation for CVS Health’s stock in relation to sales performance.
-
EV/EBITDA Analysis (Enterprise Value to its Earnings Before Interest, Taxes, Depreciation & Amortization): CVS Health’s EV/EBITDA ratio at 9.98 suggests potential undervaluation, falling below industry averages.
Market Capitalization: Boasting an elevated market capitalization, the company surpasses industry averages. This signals substantial size and strong market recognition.
Now trade stocks online commission free with Charles Schwab, a trusted and complete investment firm.
Why Insider Transactions Are Key in Investment Decisions
Insider transactions, although significant, should be considered within the larger context of market analysis and trends.
In the context of legal matters, the term “insider” refers to any officer, director, or beneficial owner holding more than ten percent of a company’s equity securities, as outlined by Section 12 of the Securities Exchange Act of 1934. This includes executives in the c-suite and significant hedge funds. Such insiders are obligated to report their transactions through a Form 4 filing, which must be completed within two business days of the transaction.
Pointing towards optimism, a company insider’s new purchase signals their positive anticipation for the stock to rise.
Despite insider sells not always signaling a bearish sentiment, they can be driven by various factors.
Breaking Down the Significance of Transaction Codes
Examining transactions, investors often concentrate on those unfolding in the open market, meticulously detailed in Table I of the Form 4 filing. A P in Box 3 denotes a purchase, while S signifies a sale. Transaction code C indicates the conversion of an option, and transaction code A denotes a grant, award, or other acquisition of securities from the company.
Check Out The Full List Of CVS Health’s Insider Trades.
Insider Buying Alert: Profit from C-Suite Moves
Benzinga Edge reveals every insider trade in real-time. Don’t miss the next big stock move driven by insider confidence. Unlock this ultimate sentiment indicator now. Click here for access.
This article was generated by Benzinga’s automated content engine and reviewed by an editor.
Add Comment