Executive Summary

• CVS reported 2Q16 adjusted EPS of $1.32, up 8.3% year over year and ahead of guidance of $1.28–$1.31, beating the consensus estimate by two cents. The company reported revenues of $43.7 billion, up 17.6% year over year but missing the $44.3 billion consensus estimate.
• Growth was driven by the Pharmacy Services segment, whose revenues grew by 20.7% year over year, to $29.5 billion, due to higher pharmacy network claim volume and growth in specialty pharmacy.
• The company raised and narrowed its FY16 adjusted EPS guidance to $5.81–$5.89 from $5.73–$5.88 previously, though it lowered its GAAP EPS guidance due to debt extinguishment and acquisition-integration costs.