CVS Stock Moves Lower as Analysts Cut Price Targets

There is plenty of room for downgrades and/or more price-target cuts

by Emma Duncan

Published on Apr 18, 2019 at 10:10 AM

Shares of CVS Health Corp (NYSE:CVS) are moving lower in this morning's trading, last seen down 0.3% at $52.37. The drugstore chain received a price-target cut to $75 from $90 at Raymond James, and although Guggenheim initiated coverage with a "buy" rating, the firm lowered its price target by 25% to $63, with the latter noting it "underestimated the structural and integration issues facing the business."

On the charts, CVS has had a rough go, with the stock already down 19% year-to-date, and losses accelerating after a late-February plunge. More recently, the security has been pressured by its 30-day moving average and the $54 level -- home to its March 27 bear gap close, and not far off its recent April 2 six-year bottom at $51.77. 

In spite of this, call options traders have been flocking to CVS. Data from the International Securities Exchange (ISE), Chicago Board Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX) shows CVS with a 50-day call/put volume of 3.24, ranking in the 100th annual percentile. This suggests calls have been bought over puts at a faster-than-usual clip, and a shift in sentiment among speculators could create headwinds for the stock.

More bearish analyst notes could turn up the heat on CVS stock, too, considering the majority of the 20 firms covering the security sport "buy" or "strong buy" ratings. Plus, the equity's average 12-month price target of $72 stands at a 37% premium to current levels, which leaves plenty of room for downgrades and/or more price-target cuts on CVS stock.

START YOUR SATURDAY SMARTER.


The best of Schaeffer's market analysis in a 5-minute weekly read.


 
 

Partnercenter


NEW! Explore Schaeffer’s Partners' deals and get connected to top online brokerages with deals tailored exclusively for our readers.  Get answers to your questions regarding transfer fees, commission rates, programs and available discounts related to online trading services.

MORE | MARKETstories


16-Hour "Jump Trades" Unlock New Profit Potential
Click to continue to advertiser's site.
Why Dermira, Menlo Therapeutics are Red-Hot Today
The broader stock market is much lower this afternoon, though
Banks, Blue Chips Kick Off Earnings Season
Dow earnings are expected to come in droves again next week
16-Hour "Jump Trades" Unlock New Profit Potential
Click to continue to advertiser's site.