Bolstered by an increase in business due to both an acquisition and a dispute involving a key competitor, CVS Caremark (NYSE:CVS) announced revenue and earnings gains above analyst expectations this morning, boosting the Woonsocket, Rhode Island drugstore and pharmacy operator’s stock price 3% in early trading.
CVS released adjusted earnings of 65 cents per share on revenues of $30.8 billion for the first quarter, beating analyst estimates of 62 cents per share on $30.2 billion in revenues.
The company also raised expectations for the second quarter to 78 cents to 80 cents per share, above analyst estimates of 74 cents per share.
CVS saw great benefit from a dispute between competitor Walgreen (NYSE:WAG) and prescriptions benefits manager Express Scripts (NASDAQ:ESRX). According to the Washington Post, customers looking to fill prescriptions through Express Scripts at Walgreens are migrating to CVS.
Revenue from the company’s pharmacy benefits management, or PBM, segment climbed 32 percent mainly because of business gained from the acquisition of Universal American Corp.’s Medicare prescription drug business.
Revenues at stores open at least a year climbed more than 8 percent, and pharmacy sales grew nearly 10 percent. An early allergy season and an extra day in the quarter caused by the leap year also helped sales.