Standpoint Research Downgrades CVS Caremark (CVS) to Hold

Standpoint Research downgraded CVS Caremark (NYSE: CVS) from Buy to Hold.

"CVS shares are up 30% for us and hit our price target. CVS shares are nearing a three-year high and appear to be fairly valued here at 13X trailing twelve months earnings, 13X estimates for 2011 and 12X (record earnings) estimates for 2012 (that have declined from $3.32 to $3.15 in the last 90 days. CVS market cap is $50 bln and 12X is fair value for a company with this size and growth prospects. The shares still look attractive on some valuation measures such as P/S and EV/EBITDA, but not on the P/E or P/E/G ratio. We are no longer comfortable leaving our highest rating attached to this name. CVS may still be suitable for those who need to be fully invested and need some low-beta hedges in their portfolio to offset the high-beta names (in a high-beta portfolio)."

For more ratings news on CVS Caremark click here and for the rating history of CVS Caremark click here.

Shares of CVS Caremark closed at $36.37 yesterday.

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