CVS's stock price has dropped by more than 20% this year amid Medicare challenges within Aetna as medical costs increased, and on top of that, there was potential activist investor action.
We are not surprised by the management change given the execution shortfalls at CVS, especially at the Aetna medical insurer that Lynch previously led, said Julie Utterback, a senior equity analyst for Morningstar.
But Lynch couldn't fully deliver on the paradigm that's already starting to upend the current regime, writes Shawn Tully in a new article.
CVS is pursuing a multiyear opportunity to deliver $2 billion in savings, that will involve cutting less than 1% of its workforce, or around 2,900 workers, and investing in technologies.
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