CVS Health plans to hire an additional 15,000 employees to meet an expected rise in demand for Covid-19 testing and flu shots as the fall and winter season approaches.
CVS Health (CVS) said that about two-thirds of the new hires will be full-time and part-time licensed pharmacy technicians to assist in serving medications and administering Covid-19 tests. In September, the US Department of Health and Human Services (HHS) issued guidance to authorize state-licensed pharmacists to order and administer Covid-19 vaccinations to individuals aged 3 or older.
“Additional team members typically are needed every flu season,” CVS Health chief human resources officer Lisa Bisaccia said. “However, we’re estimating a much greater need for trained pharmacy technicians this year given the continued presence of Covid-19 in our communities.”
Last month, CVS announced a plan to add more than 2,000 new Covid-19 drive-thru test sites in selected CVS pharmacy locations in the US. The company has the largest number of independently run Covid-19 test sites in the country. It opened its first test site in March and the addition of new test sites will bring the total test sites in the country to more than 4,000 by mid-October.
Separately, the drugstore chain announced on Oct. 16 that it has signed an agreement with the US government to provide Covid-19 vaccinations to long-term care facilities, such as nursing homes, throughout the country when a safe and effective vaccine becomes available. CVS said that until now it has already administered more than 5 million Covid-19 tests.
“Moving forward we’ll have the capacity to administer approximately 4 million Covid-19 tests per month to meet the nation’s needs ahead of a vaccine approval,” said CVS Health CEO Larry Merlo.
Shares in CVS are down almost 20% this year, but the Street has a Strong Buy analyst consensus on the stock with 9 Buys versus 3 Holds. The $81.11 average price target implies upside potential of about 36% to current levels.
Tigress Financial analyst Ivan Feinseth recently maintained a Buy rating on the stock saying that the drugstore chain “becomes increasingly best-positioned to be the leading multichannel healthcare services provider”.
“CVS continues to increase its Covid-19 testing facilities and capabilities via the ongoing expansion of drive-up testing, along with working with businesses and schools to provide on-site testing capabilities as well,” Feinseth wrote in a note to investors. “CVS’s strong balance sheet and cash flow will continue to fund investments in new growth initiatives, strategic acquisitions and prioritize the reduction of debt along with enhancing shareholder returns through the eventual resumption dividend increases and share repurchases.” (See CVS stock analysis on TipRanks)
“We believe significant upside exists from current levels and continue to recommend purchase,” the analyst summed up.
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