| | | "CVS simply is executing better with their integrated insurance, Pharma benefit and retail/pharmacy concept and they have mini clinics in some of the pharmacies in my neighborhood and it seems to be working."
I assume that's probably why we see the positive growth in their Net Income numbers over the last few Quarters, compared to the opposite that occurred even though there was a continual upward trend in their Top Line Revenue numbers.
As you may have gathered by now I'm a "Bottom Line" guy. The more of the Revenue that ends up there the better I like it. When you end up with only 2% or 3% Net Income it doesn't take much to go wrong before there's a Loss and a negative contribution to the Balance Sheet.
" ... to delever, a hard way via paying back debt, and the easy way via growing the business and the FCF, which even if no debt is payed back improves the credit metrics"
Well, a company's Credit Rating may go up resulting in it getting a more favourable payback interest rate. But a debt expense is still money going into someone else's pocket. It may not be that onerous if one has borrowed at, say, 5% but can earn, say, 8% with that borrowed money. But if it's the other way around it's probably more prudent to pay that debt off as soon as possible.
It should be interesting to see what CVS's future Quarterlies look like. I guess if their Bottom Line keeps improving they could break through that ~$80 barrier .... |
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