CVSCAUTIOUS

Return on Equity (ROE)

3.8%

Updated 150h ago

Sector Performance

19th percentile

CVS

3.8%

Sector Median

13.8%

Sector Avg

31.4%

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Deep Analysis

A Return on Equity (ROE) of 3.8% means that for every dollar of shareholder equity, CVS generated 3.8 cents in profit over the past year — a low figure that indicates the company is producing limited earnings relative to the capital invested by shareholders.

This sits well below the sector median of 13.7%, placing CVS in the 18th percentile among its industry peers, meaning 82% of comparable companies have higher ROE. The year-over-year change and quarter-over-quarter change are both listed as N/A, so there is no trend data available to assess recent movement in profitability efficiency. The combination of a low ROE level with no observable trend suggests a current lack of earnings power, but without directional movement it is unclear whether this situation is deteriorating or beginning to improve — creating an elevated risk that returns may remain weak. This metric directly supports the overall CAUTIOUS verdict, as the company’s ability to generate shareholder returns is far below the industry norm with no evidence of a turnaround.

Frequently Asked Questions

What does the Return on Equity (ROE) tell investors about CVS?

ROE measures how effectively management turns equity into profit. Consistently above 15% is typically considered strong. Negative equity distorts this metric.

How is the Return on Equity (ROE) calculated?

Return on Equity (ROE) is calculated as: Net Income / Shareholders' Equity.

Who are CVS's closest peers by Return on Equity (ROE)?

The closest peers by Return on Equity (ROE) include: MRNA (-36.6%), FICO (-37.3%), XRAY (-37.7%), VRSN (-38.3%), MSCI (-45.3%).

The Formula

Net Income / Shareholders' Equity

Why It Matters

ROE measures how effectively management turns equity into profit. Consistently above 15% is typically considered strong. Negative equity distorts this metric.