CVS · Q2 FY2026
CVS HEALTH Corp Q2 FY2026 earnings analysis
By SageNoodle ResearchBullish
| Metric | Actual | Estimate | Result |
|---|---|---|---|
| Revenue | $106.1B | $98.9B (yr ago) | Beat |
| EPS | $2.31 | $0.80 (yr ago) | Beat |
| Free Cash Flow | $5.65B | $1.29B (yr ago) | Beat |
| Gross Margin | Not disclosed | Not disclosed (yr ago) | Miss |
| Operating Margin | 4.4% | 2.4% (yr ago) | Beat |
What changed
Revenue increased 7.3% year over year, while GAAP operating income nearly doubled to $4.70 billion as Health Care Benefits margins recovered and prior-year litigation charges did not recur. Quarterly free cash flow rose to $5.65 billion, and CVS raised full-year GAAP EPS guidance by $0.60 at the midpoint while increasing cash-flow-from-operations guidance by at least $2.0 billion.
Impact on the investment thesis
There was no prior SageNoodle fair value to revise. We establish fair value at $104 per share: the stronger insurance recovery and higher guidance support the valuation, but elevated medical costs, substantial debt and partial reliance on favorable comparisons limit the upside.