CVS Should I Buy
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CVS Health Corp is a good buy for a beginner investor with a long-term strategy and $50,000-$100,000 available for investment. The company's strong revenue growth, improved net income, and positive analyst sentiment outweigh the short-term headwinds from Medicare Advantage reimbursement rate concerns. Additionally, the options data suggests a neutral-to-bullish sentiment, and the stock is trading near a key support level, making it an attractive entry point.
The MACD is positive and expanding, indicating bullish momentum. RSI is neutral at 57.409, and moving averages are converging, suggesting a potential breakout. The stock is trading near a key support level (Pivot: 76.125), with resistance levels at R1: 78.442 and R2: 79.874.
Strong Q4 2025 financial performance with an 8.17% YoY revenue increase and a 79.01% YoY net income increase.
Analysts maintain a generally positive outlook, with multiple Buy ratings and price targets ranging from $90 to $
Hedge funds have shown increased interest in CVS Health, as indicated by the rise in shares held in 13F filings.
Concerns about Medicare Advantage reimbursement rates for 2027, which could impact margins.
Lower-than-expected fiscal 2026 revenue guidance, which may weigh on investor sentiment.
Broader market weakness, as indicated by the S&P 500's -1.54% change.
In Q4 2025, CVS Health reported revenue of $105.69 billion, up 8.17% YoY. Net income increased significantly by 79.01% YoY to $2.94 billion, and EPS rose by 76.15% YoY to $2.29. However, gross margin declined slightly by -2.73% YoY to 12.84%.
Analysts are generally optimistic, with multiple Buy ratings and price targets ranging from $90 to $101. While some analysts have lowered price targets due to Medicare Advantage concerns, they acknowledge CVS's diversified business model as a mitigating factor. The company's long-term earnings growth outlook remains strong, with mid-teens EPS growth projected through 2028.
