Glenview Capital Management Pressures CVS Health (CVS) for Operational Improvements

Sep 30, 2024

Glenview Capital Management is set to meet with CVS Health (CVS, Financial) executives on Monday to propose strategies for improving operations. Glenview, led by founder Larry Robbins (Trades, Portfolio), has invested approximately $700 million in CVS Health, representing a substantial portion of its $2.5 billion hedge fund. Glenview currently owns about 1% of CVS Health's outstanding shares, which contribute to the company's $77.2 billion market capitalization.

According to sources, Glenview's significant stake signals Robbins' confidence in CVS Health's potential and his belief in steering the management towards new operational strategies. The upcoming discussion is expected to focus on enhancing CVS Health's operations, especially in light of challenges such as repeated downward profit revisions throughout the year.

Recently, CVS Health lowered its annual earnings forecast, citing pressure on its Aetna insurance subsidiary's healthcare benefits segment. The company's annual profit outlook has been adjusted to a range of $6.40 to $6.65 per share, in contrast to the market expectation of $6.54 per share. Year-to-date, CVS Health's stock has declined by approximately 23%.

Disclosures

I/We may personally own shares in some of the companies mentioned above. However, those positions are not material to either the company or to my/our portfolios.

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