CVS Health Q3 profit misses estimates, company names new leaders at 2 divisions
CVS Health on Wednesday posted a miss in third-quarter profit and named executives for two key divisions
CVS Health fell short on third-quarter profit, but it posted strong sales and the health care giant shook up leadership under new CEO David Joyner after a rough year that has sent shares plunging.
Shares jumped 13% at the opening bell as markets as a whole surged on an election that will send Donald Trump back to the White House.
Joyner named UnitedHealth executive Steve Nelson as the leader of the company's troubled health insurance wing, Aetna. That appointment is effective immediately.
Prem Shah, who joined the company in 2013, will lead CVS Caremark, CVS Pharmacy, and the company’s Health Care Delivery businesses.
CVS Health runs one of the nation’s largest drugstore chains and a huge pharmacy benefit management business that operates prescription drug coverage for employers, insurers and other big clients. It also covers nearly 27 million people through its Aetna insurance arm.
CVS' insurance business has dragged on the company's performance and many see in Nelson an industry veteran who can provide a needed jolt.
“The new leadership announcement gives us hope that CVS is moving quickly to improve its business execution,” said John Boylan at Edward Jones. “However, we also believe that these are the first steps in CVS improving its operations, which may take time. Having said that, we will be watching closely what changes management will make and how those changes may translate into sustainable sales and earnings growth rates.”
The company earned $87 million in the three months ended in September, down 96% from a year ago. Results were weighed down by hefty restructuring charges. On an adjusted basis,
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