CVS Health Corporation (CVS): A Bull Case Theory

We came across a bullish thesis on CVS Health Corporation on Microcapexpert’s  Substack. In this article, we will summarize the bull’s thesis on CVS. CVS Health Corporation’s share was trading at $67.58 as of June 24^th. CVS’s trailing and forward P/E ratios were 16.13 and 11.49, respectively, according to Yahoo Finance.

The UK’s Competition and Markets Authority (CMA) has published its initial findings on the veterinary services market, and the proposed remedies appear relatively mild for CVS Group. While the CMA highlights the need for improved price transparency, there are no indications of harsh regulatory actions that could threaten CVS’s profitability or operational structure. This early outcome validates previous expectations that the regulatory scrutiny would result in limited disruption.

Although these are not yet the CMA’s final conclusions—with a full report expected in the coming months—the working paper offers a reliable preview of the ultimate resolution. With the regulatory overhang easing, investor sentiment has improved significantly. CVS’s share price jumped 12% on the news and has now surged 50% since the start of the year. Despite this rebound, the stock still trades below the 2,000 pence level it held prior to the launch of the CMA investigation, suggesting more upside may lie ahead as the market fully digests the benign regulatory outcome.

The stock’s momentum is likely to continue as clarity returns and investors reprice the reduced risk profile. In the absence of severe restrictions, CVS can continue leveraging its scale and efficiencies in the UK veterinary market, and with regulatory uncertainty fading, valuation multiples may expand. For investors who were cautious due to regulatory concerns, this working paper signals a potential green light to reenter. Overall, CVS stands to benefit as regulatory fears dissipate and the market acknowledges the limited impact of the CMA’s review.

Previously, we covered a bullish thesis on CVS Health Corporation by Hidden Market Gems in April 2025, which highlighted its U.S.-centric revenues, essential offerings, and strong cash flow. The company’s stock has depreciated ~4% since our coverage, as macro pressures persisted. The thesis still stands. Microcapexpert shares a similar view but emphasizes the regulatory clarity as a new catalyst.

CVS Health Corporation is not on our list of the 30 Most Popular Stocks Among Hedge Funds. As per our database, 73 hedge fund portfolios held CVS at the end of the first quarter, which was 74 in the previous quarter. While we acknowledge the risk and potential of CVS as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and have limited downside risk. If you are looking for an extremely cheap AI stock that is also a major beneficiary of Trump tariffs and onshoring, see our free report on the best short-term AI stock.

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Disclosure: None.