CVS vs CVS Health Which Is More Lucrative?

CVS Health Corporation is a diversified healthcare company that owns CVS Pharmacy, a retail pharmacy chain. While both companies are a part of the same overall entity, CVS Health Corporation focuses on providing healthcare services and products, while CVS Pharmacy is primarily a retail pharmacy. Investors may choose to invest in either CVS Health Corporation or CVS Pharmacy individually, depending on their investment goals and preferences within the healthcare industry.

CVS or CVS Health?

When comparing CVS and CVS Health, different investors may prioritize various metrics based on their investment strategies and goals. So, ask yourself what type of investor you are. This will guide you in determining which metrics are most important for your investment decision between CVS and CVS Health.

Dividend Investors:

Dividend investors look for stable and growing income streams, using dividend metrics to assess potential investments. A company's dividend yield essentially measures the size of its dividend relative to the total market value of the company. CVS has a dividend yield of 0.87%, while CVS Health has a dividend yield of 5.96%. Beyond the yield itself, considering the growth and sustainability of these dividends is also crucial. CVS reports a 5-year dividend growth of 0.00% year and a payout ratio of 15.25%. On the other hand, CVS Health reports a 5-year dividend growth of 3.89% year and a payout ratio of 66.07%.

Value Investors:

Value investors focus on financial metrics to determine a stock's intrinsic value compared to its market value. The Price-to-Earnings (P/E) Ratio links stock price to a company's earnings per share, with CVS P/E ratio at 18.61 and CVS Health's P/E ratio at 14.01. Another crucial valuation metric is the Price-to-Book (P/B) Ratio, which compares stock price with book value per share. CVS P/B ratio is 2.53 while CVS Health's P/B ratio is 0.94.

Growth Investors:

Growth investors prioritize metrics indicative of a company's expansion potential. Focusing on top-line growth, CVS has seen a 5-year revenue growth of 0.73%, while CVS Health's is 0.49%. Return on Equity (ROE) measures how effectively a company uses equity investment to generate earnings, with CVS's ROE at 13.44% and CVS Health's ROE at 6.68%.

Retail Investors:

Retail investors often consider stock affordability and company familiarity. For example, day low prices are $11.84 for CVS and $55.16 for CVS Health. Over the past year, CVS's prices ranged from $11.50 to $23.86, with a yearly change of 107.48%. CVS Health's prices fluctuated between $52.77 and $83.25, with a yearly change of 57.76%. Brand recognition also plays a role, as familiarity with a company can influence investment decisions.