CVS Health Corp. tops quarterly forecasts but 2019 outlook weak

Associated Press

CVS Health beat fourth-quarter earnings forecasts, but a struggling long-term care business took a $2.2-billion bite out of the company’s performance and its initial 2019 forecast was weaker than expected.

Shares tumbled more than 5 percent less than two hours before the opening bell Wednesday.

CEO Larry Merlo said in a prepared statement 2019 would be “a year of transition” as the company integrates the health insurer Aetna purchased in a roughly $69 billion deal last year. A federal judge is still evaluating the acquisition.

CVS Health expects adjusted earnings between $6.68 and $6.88 this year, well short of the per-share earnings of $7.35 anticipated by Wall Street, according to a survey of industry analysts by FactSet.

CVS Health Corp., of Woonsocket, R.I., operates more than 9,900 retail locations and processes more than a billion prescriptions annually as a pharmacy benefit manager. Its other business that provides services to long-term care facilities struggled from operational problems and the bankruptcy of a significant customer.