Cvs Caremark Essay

1973 Words Jan 28th, 2013 8 Pages
CVS Caremark

Overview In our society, many people suffer from ailments and diseases that require medication to help them manage their illnesses while trying to maintain a normal lifestyle. Approximately 75% of the US population lives within three miles of a CVS (Datamonitor,2011), a retail pharmacy which sells prescription drugs and a range of general merchandise including over the counter drugs, beauty products and cosmetics, photo finishing, seasonal merchandise, greeting cards, and convenience foods (Mergent, 2012). Pharmacy services for CVS also include a mail order pharmacy service, specialty pharmacy services, plan design and administration, formulary management and claims processing. CVS also possesses in store health clinics
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MinuteClinic now stands as the nation’s largest walk-in medical clinic. The clinics treat common ailments, performs health screenings and the give vaccinations. The demand for walk-in clinics led to their quick growth which yielded over 500 stores in 2008.
In this paper, I will give you a financial analysis of CVS Caremark for the years of 2009, 2010, and 2011. I have given an overview of the corporation, now I will evaluate the company’s vulnerability to current financial threats and predict how trends will impact their financial performance in the future. I will analyze their financial statements, their stock and give a recommendation to improve their stock performance. The company’s ratio analysis will give information about their operation and financial condition. The stock analysis will show how the company continues to remain competitive after different financial threats.

Financial Threat & Vulnerability As I look over CVS’ financial statements, it is evident that they can withstand threats such as a recession. Net income is revenues less expenses, taxes, and preferred dividends (Brigham & Ehrhardt, 2011). We recently came out of a recession that lasted from 2007 to 2009 and their net income in 2009 ($2.55 Million) was higher than their net income in 2010 ($2.49 Million). As a matter of fact, CVS reported higher net income and higher

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