CVS Health Corp (CVS) stock analysis
CVS Health Corp (CVS) clears 5 of this site's 8 mechanical value filters, 2 of 8 Buffett-style checks and 3 of 5 Lynch-style checks. At $94.48 it trades 40.8% below this site's neutral DCF value (a margin of safety of +40.8%). Its earnings quality rates Strong and it returns +2.4% to shareholders net of dilution. Figures are as of October 23, 2026, from SEC filings and market data refreshed weekly; this is educational analysis, not investment advice.
Data as of October 23, 2026. Refreshed weekly from SEC filings and market data.
What does CVS Health do?
CVS Health combines the CVS Pharmacy retail chain, the Aetna health insurer and the Caremark pharmacy-benefit manager, plus primary-care clinics and home health. It earns from insurance premiums, prescriptions and fees.
Brands and businesses it owns
- CVS Pharmacy
- Aetna
- CVS Caremark
- Oak Street Health
- Signify Health
- MinuteClinic
What stands out about CVS Health?
- The share price implies shrinking cash flow. At $94.48, CVS's free cash flow of $9.34 per share would have to shrink 4.8% a year at first, then recover to 2.5% growth by year 10, for this site's DCF (10% discount rate) to match the price. This site's baseline starts at 8% growth, so the price asks for less growth than the baseline. Change the assumptions.
- Misses 1 of the 8 value filters. It fails PEG Ratio < 1.5 (1.96); the other 5 pass and 2 were not evaluated. See every filter.
- Strongest against peers: dividend yield. At 2.87% (peer median 1.10%) it ranks 2nd of 21 among health care stocks this site tracks. See the ranking.
- Balance sheet in the distress zone. Its Altman Z″-Score is 0.99; below 1.1 is the distress zone, 1.1 to 2.6 the grey zone. See the Altman Z″-Score list.
- Dividend raises 1 of 6 flags. Its trailing yield is 2.87%. See the Sustainable Dividend Screener.
How has CVS Health's share price moved?
The interactive price chart needs JavaScript.
Is CVS Health undervalued? The value diligence check
Every value-investing signal this site computes for this stock, gathered in one place: the same real numbers from the tools below, not a new score.
- Margin of safety (DCF) +40.8%
- P/E vs. its own history 24.3x · near the cheap end Real range: 12.2x–58.4x over 5 years (net income per diluted share from each fiscal year's 10-K, paired with the real closing price at that fiscal year-end).
- Wall St. analyst rating Buy · 4.12/5 32 analysts this month: 8 strong buy, 20 buy, 4 hold, 0 sell, 0 strong sell (Finnhub). Up from 4.09 last month.
- Altman Z″-Score (bankruptcy risk) 0.99 · Distress zone
- Earnings quality (is the profit real?) Strong · all 5 checks clean Beneish M-score −2.58 · accruals −3.5% of assets · 225% of profit arrived as cash · stock comp 0.1% of revenue · share count −0.7% a year. From the latest 10-K (year to Dec 2025) - see the Earnings Quality Screener for how each check is scored.
- Shareholder yield (cash back to owners) +2.4% net Latest fiscal year (2025): dividends 2.9% + buybacks 0.0% − stock comp 0.4%, as a share of today's market cap. Over 14 years its split-adjusted share count fell 6%. See Shareholder Yield Leaders.
- Capital needed to grow (See's test) $25.92 per $1 of new profit · Capital-hungry · but only 8% return on capital Operating profit $8.0B → $9.0B, capital needed $85B → $111B, 2016–2025 (3-year averages); return on capital now 8% before tax. Buffett's See's Candies needed $0.42 per $1 of new profit, FlightSafety $3.20, a typical grower about $5. See Capital-Light Compounders.
- PEG (growth at a reasonable price) 1.96 · Above fair P/E 24.3× ÷ 12.4% a year of growth behind it. 221st lowest of 447 stocks with a usable PEG. Lynch's fair value is a PEG of 1; a very high PEG usually means almost no growth, a very low one a profit spike. See PEG Ratio Ranking.
- Compounder lenses (4) 2 of 4 · misses capital-light, price Capital-light growth: not cleared (profit grew 1.1×, under 2×); Profit is real: cleared; Cash to owners: cleared; Fair price (PEG): not cleared (PEG 1.96, over 1.5). See Compounders at a Fair Price, which also lets you move the PEG bar.
- Value trap check Clear
- Munger's Inversion Check 0 flags
- Standing vs. sector peers 3 of 7 measures above the median Compared with the 33 other health care stocks this site tracks: 2 in the top third, 3 in the bottom third.
- Dividend payout sustainability 1/6 flags
How does CVS Health compare with its peers?
3 of 7 measures sit above the median of the 33 other health care stocks tracked here, 2 in the top third and 3 in the bottom third.
- P/E ratiolower is cheaper · peer median 24.6× 24.3× –15th of 32
- Free-cash-flow yieldhigher is cheaper · peer median 5.5% 9.9% ✓5th of 34
- Return on equityhigher is better · peer median 15% 6% ✕30th of 34
- Net marginhigher is better · peer median 9.3% 1.2% ✕28th of 34
- Revenue growthhigher is better, year on year · peer median 8.6% 7.4% –21st of 34
- Debt / equitylower is safer · peer median 0.69 0.77 ✕25th of 34
- Dividend yieldamong dividend payers · peer median 1.10% 2.87% ✓2nd of 21
Peers are the stocks this site tracks in the same sector group, not every listed competitor. The bar runs from the weakest peer (left) to the strongest (right); the tick is the middle. Measures that don't apply to a sector (cash-flow yield for banks, debt for financials) are left out.
What would Buffett & Lynch say?
Buffett's checklist is built around durable, profitable businesses bought at sensible prices, and CVS doesn't clear enough of it yet. In its favor: CVS is trading below what a conservative discounted-cash-flow estimate says it's worth - his own "price is what you pay, value is what you get" test, not a fixed multiple ceiling, and trades at a reasonable multiple of owner earnings, his own term for the real cash a business could pay out. Where it comes up short: CVS isn't clearing the return-on-equity bar he'd want to see right now, and its five-year average return on equity falls short too, so this isn't just a one-off dip, carries more debt relative to equity than he typically tolerates, runs thinner pretax margins than he'd like to see, hasn't grown earnings per share fast enough over five years to impress him, and doesn't cover its interest expense as comfortably as he'd want.
- ROE (TTM) > 11% ✕
- ROE (5yr avg) > 11% ✕
- Debt/Equity < 0.5 ✕
- Pretax margin > 15% ✕
- EPS growth (5yr) > 7% ✕
- Interest coverage > 5x ✕
- Trading below intrinsic value (DCF) ✓
- Price vs. owner earnings < 25x ✓
Lynch looked for growth stories that weren't overpriced for that growth, and CVS falls short of his bar. In its favor: CVS pays a real dividend, the actual reason he bought slow growers at all, is growing at the modest, GDP-ish pace typical of a slow grower, and converts earnings into real cash at a reasonable price. Where it comes up short: CVS carries more debt than he liked to see, even allowing for the extra room a large, stable business gets, and is priced too rich for how little growth is actually left in the business.
- Dividend yield > 2.5% ✓
- EPS growth 0%-10% ✓
- Debt/Equity < 0.6 ✕
- P/E < 20 ✕
- Price/FCF < 25 ✓
Quantitative approximations of each investor's documented approach, not endorsed by either investor or their estates - commentary, not this site's actual ranking criteria. Buffett never published a numeric checklist: only 2 of his 8 checks here trace to his own documented concepts ("owner earnings," from his 1986 shareholder letter, and "price is what you pay, value is what you get," his case against fixed P/E/P/B ceilings) - the other 6 (ROE, debt, margins, growth, interest coverage) use commonly-cited thresholds that are not numbers he himself published. The 8 hard filters below (plus the Munger check and Graham margin of safety) are this site's real, mechanical screen and are computed completely independently of the checklists above.
Berkshire Hathaway's own filing
Which of the 8 value filters does CVS Health pass?
- Market Cap > $25B $118.9B
- Trailing P/E < 25 24.32
- PEG Ratio < 1.5 1.96
- Price/Book < 8 1.49
- Price/Sales < 7 0.29
- EPS Growth YoY > -5% +187.9%
- vs 50-day MA (±12%) Not evaluated †
- vs 200-day MA (±12%) Not evaluated †
What is CVS Health's margin of safety?
+45% on 2026-10-07 → +41% on 2026-10-23 (5 weekly readings).
Where is CVS Health in its 52-week range?
What is the short interest in CVS Health?
16,470,151 shares short as of 2026-09-30 (FINRA settlement date). Reported twice a month, so this only changes roughly every two weeks, not daily.
What could go wrong with CVS Health? Munger's inversion check
"Invert, always invert." Instead of reasons to buy, these are reasons to hesitate, not a verdict, and not everything worth knowing about a business.
- Margin of safety, even in the bull case +65%
- Short interest under 5% of float 1.3%
- Passes most of the 6 fundamental filters 5/6 passed
- Price run-up backed by value, not just momentum +35% off 52wk low
- Debt/equity stable since 2016 0.70 → 0.86
Doesn't cover circle of competence, management quality, or accounting concerns: those need judgment, not data.
How much have CVS Health shareholders gained per year?
Earnings growth per share plus dividend.
An earnings-based proxy, not a stock-price total return - it doesn't capture multiple expansion/contraction or reinvested dividends. EPS from CVS's own 10-K filings; dividend yield is the current trailing yield on today's price, from the same weekly fetch as the rest of this site.
What do CVS Health's 10-year financials show?
From CVS's own 10-K filings (SEC EDGAR): up to the last 10 fiscal years. Press any year's bars for the exact figures.
Frequently asked questions about CVS Health
What kind of company is CVS Health?
CVS Health combines the CVS Pharmacy retail chain, the Aetna health insurer and the Caremark pharmacy-benefit manager, plus primary-care clinics and home health. It earns from insurance premiums, prescriptions and fees. Brands and businesses it owns include CVS Pharmacy, Aetna, CVS Caremark, Oak Street Health, Signify Health and MinuteClinic. This site groups it with Health Care stocks.
Is CVS Health trading above or below its DCF value?
At $94.48, CVS trades 40.8% below this site's neutral DCF value of $159.49 per share, a margin of safety of +40.8%. That DCF projects free cash flow for 10 years, with growth starting at 8% and fading to 2.5%, discounted at 10%; it is one set of assumptions, not a forecast. Test your own in the Intrinsic Value Calculator.
How many of this site's 8 value filters does CVS Health pass?
CVS passes 5 of 8. It passes Market Cap > $25B ($118.9B), Trailing P/E < 25 (24.32), Price/Book < 8 (1.49), Price/Sales < 7 (0.29) and EPS Growth YoY > -5% (+187.9%). It misses PEG Ratio < 1.5 (1.96). vs 50-day MA (±12%) and vs 200-day MA (±12%) were not evaluated, because the moving-average checks only run on stocks that clear the fundamentals first. The 8-filter list shows every stock that passes all of them.
How much cash does CVS Health return to shareholders?
CVS's net shareholder yield is +2.4%: the cash it returns through dividends and buybacks, minus stock-based compensation, as a share of its market value. Latest fiscal year (2025): dividends 2.9% + buybacks 0.0% − stock comp 0.4%, as a share of today's market cap. Over 14 years its split-adjusted share count fell 6%. Its trailing dividend yield is 2.87%, paid out of 29% of its free cash flow; the dividend-sustainability check raises 1 of 6 flags (weak interest coverage and a yield far above its sector's). See Shareholder Yield Leaders and the Sustainable Dividend Screener.
How risky is CVS Health's balance sheet?
CVS's Altman Z″-Score is 0.99, which falls in the distress zone. Altman's own thresholds are above 2.6 for the safe zone, 1.1 to 2.6 for the grey zone and below 1.1 for the distress zone; the score blends working capital, retained earnings, operating profit and equity against liabilities. Its debt-to-equity ratio is 0.77, against a sector median of 0.69. See the Altman Z″-Score list.
When does CVS Health report earnings next?
CVS Health's next earnings report is expected on November 4, 2026 before the market opens, with analysts expecting earnings of $1.67 per share. Dates come from the Finnhub earnings calendar and can move. In its last 4 quarters it beat the estimate 4 times, by an average of +19.6%.
Where do these numbers come from?
- Financial statements: CVS Health's 10-K annual report for the year ended Dec 31, 2025, filed Feb 10, 2026 (filing index). Every earlier year in the 10-year financials comes from the company's older 10-K filings, all listed on SEC EDGAR.
- Prices and market data: quotes, P/E and analyst ratings from Finnhub; daily price history and the 52-week range from Twelve Data, both refreshed weekly. Short interest comes from FINRA, reported twice a month.
- How to check a figure: click any number in the card above to see its exact source, and read the Editorial Standards for every rule behind the checks.
About this CVS Health Corp analysis
This page shows every value-investing check the site runs on CVS Health Corp (CVS) in one place: the 8 mechanical filters, the Buffett and Lynch checklists, a margin of safety from a disclosed DCF, earnings quality, shareholder yield and how it ranks against its sector peers. The numbers come from SEC filings and public market data, refreshed weekly, and the same rules apply to every stock on the stock list. See Editorial Standards for the sources and the rules, or run your own filters in the stock screener.