CVS Health (NYSE: CVS) is the largest pharmacy services
provider in the U.S. comprised of ~9,700 pharmacies and 1,139 minute clinics.
CVS is one of the leading Pharmacy Benefit Managers ("PBMs")
providing services such as mail-order, prescription plan management, and claims
processing. With 1.6B claims processed in 2016, it is the largest PBM as
Walgreens (NASDAQ: WBA) processed 740mm. CVS' size gives it premium negotiating
power and scale advantages.
Over the last 12 months, CVS's share price is down 23%. I
will argue that this selloff is overblown and positions CVS as a quality
company that is attractively valued in widely overvalued market.
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