An Analysis of CVS Health Corporation

This table shows some key metrics collected from Yahoo! and Morningstar.

Also assume:

T$-$bill rate $=1\mathrm{.}6\%$

Market risk premium $=8\mathrm{.}3\%$

CVS Beta $=0\mathrm{.}96$

Dividend per share $=$$$2$

Tax rate $=21\%$

Pre$-$tax cost of debt $=2\mathrm{.}9\%$

Calculate price per share using the following models:

DDM

FCF Model

Price Ratio Analysis $($P$/$E$,$ P$/$CF$,$ P$/$S$)$

TABLE $6\mathrm{.}3$ Key Statistics for CVS Health Corporation

$\backslash$table$[[$Metric$,$Value,Source$],[$Return on equity,$10\mathrm{.}5\%,$Yahoo!$],[$Debt$-$to$-$equity ratio,$2\mathrm{.}09,$Yahoo!$],[$Shares outstanding $($billions$),1\mathrm{.}322,$Yahoo!$],[$Sales per share,$$220\mathrm{.}96,$Yahoo!$],[$Earnings per share,$$5\mathrm{.}98,$Yahoo!$],[$Cash flow per share,$$12\mathrm{.}25,$Estimated via Yahoo!$],[$Book value per share,$$57\mathrm{.}02,$Yahoo!$],[$Debt per share,$$119\mathrm{.}23,$Yahoo!$],[$Sales growth estimate,$4\mathrm{.}30\%,$Yahoo!$],[$Earnings growth estimate,$7\mathrm{.}20\%,$Yahoo!$],[$Cash flow growth estimate,$3\mathrm{.}50\%,$Estimated via Morningstar$],[$Five$-$year average PE$,10\mathrm{.}21,$Morningstar$],[$Five$-$year average P$/$CF$,7\mathrm{.}42,$Morningstar$],[$Five$-$year average P$/$S$,\mathrm{.}38,$Morningstar$]]$