Financial statement analysis and common stock valuation

Analysis of Liquidity Ratios

Measures the adequacy of CVS Health Corp. cash resources to meet its near-term cash obligations.

• Liquidity Ratios (Summary)
• Current Ratio
• Quick Ratio
• Cash Ratio

Dividend Discount Model (DDM)

The dividend discount model (DDM) is a technique for estimating the value of a share of CVS Health Corp. common stock issue as the present value of all future dividends.

• Intrinsic Stock Value (Valuation Summary)
• Required Rate of Return (r)
• Dividend Growth Rate (g)

Analysis of Short-term (Operating) Activity Ratios
Quarterly Data

Evaluates revenues and output generated by the CVS Health Corp. assets. Operating performance ratios describe the relationship between the CVS Health Corp. level of operations and the assets needed to sustain operating activities.

• Short-term Activity Ratios (Summary)
• Inventory Turnover
• Receivables Turnover
• Payables Turnover
• Working Capital Turnover
• Average Inventory Processing Period
• Average Receivable Collection Period
• Operating Cycle
• Average Payables Payment Period
• Cash Conversion Cycle

Analysis of Reportable Segments

CVS Health Corp. operates in 4 segments: Health Care Benefits; Health Services; Pharmacy & Consumer Wellness; and Corporate/Other.

• Segment Profit Margin
• Revenues
• Adjusted operating income (loss)

Cash Flow Statement
Quarterly Data

The cash flow statement provides information about CVS Health Corp. cash receipts and cash payments during an accounting period, showing how these cash flows link the ending cash balance to the beginning balance shown on CVS Health Corp. balance sheet.

Aggregate Accruals

Financial reporting quality relates to the accuracy with which CVS Health Corp. reported financial statements reflect its operating performance and to their usefulness for forecasting future cash flows.
Aggregate accruals deriving measures of the accrual component of CVS Health Corp. earnings.

• Balance-Sheet-Based Accruals Ratio
• Cash-Flow-Statement-Based Accruals Ratio

Income Statement

The income statement (statement of earnings) reports on the performance of CVS Health Corp., the result of its operating activities.

Common-Size Income Statement
Quarterly Data

Income statement components (revenues and expenses) shown as percentage of total sales.

Analysis of Liquidity Ratios
Quarterly Data

Measures the adequacy of a CVS Health Corp. cash resources to meet its near-term cash obligations.

• Liquidity Ratios (Summary)
• Current Ratio
• Quick Ratio
• Cash Ratio

Income Statement
Quarterly Data

The income statement (statement of earnings) reports on the performance of CVS Health Corp., the result of its operating activities.