Will Pharmacy and Consumer Wellness Segment Lead CVS' Q4 Earnings?

CVS Health CVS is scheduled to report fourth-quarter 2025 results on Feb. 10, before the market opens.

The company posted adjusted earnings per share (EPS) of $1.60 in the last reported quarter, which surpassed the Zacks Consensus Estimate by 17.65%. CVS Health beat on earnings in each of the trailing four quarters, the average surprise being 26.5%.

Q4 Estimates for CVS

The Zacks Consensus Estimate for the company’s fourth-quarter revenues is pegged at $103.1 billion, which suggests 5.5% growth from the year-ago reported figure.

The Zacks Consensus Estimate for earnings is pinned at 99 cents per share, which implies a 16.8% fall from the year-ago recorded actuals.

Estimate Revision Trend Ahead of CVS’ Q4 Earnings

Estimates for fourth-quarter earnings have increased 3.1% to 99 cents per share in the past 60 days.

Here’s a brief overview of the company’s performance leading up to this announcement.

Factors Likely to Have Shaped CVS Health’s Q4 Performance

Health Care Benefits

Within this segment, CVS is likely to have continued to navigate an elevated utilization environment. The Medicaid business has been experiencing medical cost pressures, largely driven by higher-than-expected acuity following the resumption of member redeterminations. These trends are expected to have persisted in the fourth quarter as well, weighing on Health Care Benefit revenues. CVS management earlier stated plans to exit the states in which Aetna operates on the individual public health insurance exchanges, effective January 2026.

On a positive note, revenues may have been supported by the government business, reflecting the impact of the Inflation Reduction Act on the Medicare Part D program. During the quarter, Aetna became the industry leader among national payers for 2026 Medicare Advantage Stars Ratings, expecting more than 81% of the members to be in plans rated 4 stars or higher, with more than 63% in 4.5-star plans.

CVS Health Corporation Price and EPS Surprise

CVS Health Corporation price-eps-surprise | CVS Health Corporation Quote

Aetna is one of the first, large national healthcare payers to integrate pharmacy prescriptions and medical procedures into a single clinical review. Effective November 2025, Aetna rolled out a musculoskeletal offering that includes X-rays, knee arthroplasty (THA/TKA) surgical procedure, anti-nausea and non-opioid pain medications, among others. Usage of technology innovations across its operational systems, including claims processing, client onboarding and care management, is likely to have contributed to simplifying the healthcare system. All these developments are expected to have influenced the segment’s revenues in the fourth quarter of 2025. 

The Zacks Consensus Estimate for the Health Care Benefits segment's revenues indicates a 6.7% year-over-year increase.

Health Services

Similar to the past quarters, continued pharmacy client price improvements may have restricted the full extent of the Health Services segment’s growth. Revenues are likely to have been aided by pharmacy drug mix and brand inflation.

Within Health Care Delivery, CVS completed a comprehensive review of Oak Street clinic footprint during the third quarter of 2025, leading to the decision to close underperforming locations lacking a clear route to sustainable margins. Such actions are expected to have supported an improvement in business revenues in the fourth quarter. The company is also planning to reduce the planned openings of new Oak Street clinics over the next several years. Signify Health is likely to have witnessed another quarter of solid performance, from continued strong volumes of in-home health evaluations.

CVS’ pharmacy benefit manager (PBM), Caremark, may have had another strong selling season, alongside higher retention. However, revenues in the fourth quarter may have been affected by short-term headwinds tied to a few of its client contracts.

The Zacks Consensus Estimate for the Health Services segment net revenues implies a 7.2% increase year over year.

Pharmacy & Consumer Wellness

The segment is likely to have continued its strong momentum in the fourth quarterdespite persistent pharmacy reimbursement pressures. Revenues are expected to have benefited from pharmacy drug mix and higher prescription volume, including incremental volume resulting from CVS Health’s Rite Aid prescription file acquisition.

Following the completion, the company is presently operating 63 former Rite Aid and Bartell Drugs stores in Idaho, Oregon and Washington. CVS Pharmacy is offering the updated 2025-2026 COVID-19 vaccines authorized by the Centers for Disease Control and Prevention across all its nationwide locations. These developments are expected to have favorably supported the segment’s fourth-quarter revenues.

Growth in same-store pharmacy sales may have been driven by the pharmacy drug mix, including branded GLP-1 drugs, and higher pharmacy same-store prescription volume. CVS may have continued to grow its script share, benefiting from the disruption across the retail pharmacy market.

Going by the Zacks Consensus Estimate, revenues in the Pharmacy & Consumer Wellness segment are expected to increase 9.8% in the fourth quarter of 2025.

Q4 Earnings Whispers for CVS

Per our proven model, a stock with a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold), along with a positive Earnings ESP, has a higher chance of beating estimates, which is the case here.

Earnings ESP: CVS Health has an Earnings ESP of +0.38%. You can uncover the best stocks to buy or sell before they are reported with our Earnings ESP Filter.

Zacks Rank: The company currently carries a Zacks Rank #3. You can see the complete list of today’s Zacks Rank #1 stocks here.

Other Stocks Worth a Look

Here are some other medical stocks worth considering, as these also have the right combination of elements to post an earnings beat this time:

Veracyte VCYT has an Earnings ESP of +7.98% and a Zacks Rank #1. The company is expected to release fourth-quarter 2025 results soon.

VCYT’s earnings surpassed estimates in each of the trailing four quarters, the average surprise being 45.12%. The Zacks Consensus Estimate predicts the company’s fourth-quarter EPS will increase 13.9% from the year-ago quarter’s figure.

Cardinal Health CAH has an Earnings ESP of +0.46% and a Zacks Rank #2. The company is slated to release second-quarter fiscal 2026 results on Feb. 5. 

CAH’s earnings beat estimates in each of the trailing four quarters, the average surprise being 9.36%. The Zacks Consensus Estimate expects CAH’s fourth-quarter EPS to surge 20.7% from the year-ago reported figure.

Merit Medical Systems MMSI has an Earnings ESP of +2.09% and a Zacks Rank #2. The company is slated to release fourth-quarter 2025 results on Feb. 24.

MMSI’s earnings topped estimates in each of the trailing four quarters, the average surprise being 14.1%. The Zacks Consensus Estimate for the company’s fourth-quarter EPS implies an increase of 3.2% from the year-ago quarter’s figure.

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This article originally published on Zacks Investment Research (zacks.com).

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