Why CVS Health Stock Is Back On Investors’ Radar

CVS Health (CVS) has drawn fresh attention ahead of its upcoming quarterly earnings report, as investors weigh upbeat expectations alongside a run of recent business updates and industry recognition.

Over the past year, CVS Health stock has outperformed the broader market and delivered a total return of 75.4%. The share price closed at US$105.92 on 29 July 2026, with gains of 2.3% over the past month and 27.2% over the past 3 months.

For you as a shareholder, the picture is of a stock that has delivered strong momentum over the past year, with a 75.4% one year total shareholder return and a 27.2% three month share price gain. This comes even as the share price has eased slightly in recent days ahead of earnings and amid news of pharmacy focused store openings, new wellness and pet care products in CVS Health locations, supply chain awards, and fresh attention on its Health100 app and Medicare exposure.

If CVS Health’s recent run has you thinking about what else might be moving in related areas of the market, it could be worth scanning companies powering healthcare and AI, starting with the 41 healthcare AI stocks

After a 75.4% one year total return and a recent pullback, CVS Health now trades only about 7% below the average analyst target but at a much steeper discount to some intrinsic value estimates. Where does fair value really sit?

Most Popular Narrative: 5.4% Undervalued

Using the most followed narrative, CVS Health’s fair value sits at about $111.92, a touch above the last close at $105.92, which frames today’s valuation debate.

Integration of recent and ongoing acquisitions (such as Aetna, Oak Street, and Signify Health) and vertical alignment between insurance, pharmacy, and care delivery provide substantial cross-selling and synergy opportunities, supporting long-term operating margin and earnings growth as margin recovery initiatives gain traction.

Want to see what that integration story looks like in numbers? The narrative connects modest revenue growth, rising margins, and a future earnings multiple into one valuation case. It highlights which assumptions matter most and how tightly they are wired into that $111.92 figure.

Result: Fair Value of $111.92 (UNDERVALUED)

However, CVS Health’s story also includes pressure points, such as reimbursement and utilization risks that could keep margins tight and challenge the current fair value case.

Another View on CVS Health’s Valuation

The first narrative presents CVS Health as about 5.4% undervalued using future earnings and fair value estimates. A different perspective tells a tougher story. On a P/E of 46.1x, CVS Health trades well above the US Healthcare industry at 25.9x and peers at 21.1x, and even above the 40.7x fair ratio that the market could move toward over time. Is this a sign of extra upside being priced in, or a margin of safety that is thinner than it looks?

Next Steps

If the mixed sentiment around CVS Health leaves you unsure, this is the moment to look through the data yourself and decide where you stand. To help frame both sides of the story, review the 2 key rewards and 5 important warning signs

Looking For More Investment Ideas Beyond CVS Health?

If you want to round out your view beyond CVS Health, use stock screeners to spot fresh ideas that match your risk, income, and quality preferences.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.