Is CVS Health (CVS) Undervalued As Aetna Wins Medicare Advantage Stars And Pharmacy Growth Expands?
CVS Health (CVS) stock is back in focus after Aetna secured over 69% of its Medicare Advantage members in 2027 plans rated 4 stars or higher, alongside fresh pharmacy focused store expansion.
Investors have rewarded CVS Health with a 9.26% year to date share price gain and a 13.39% total shareholder return over the past year, even though the stock has pulled back roughly 7.5% over the last month and about 17% over 90 days. This suggests momentum has cooled recently as the market absorbs Aetna’s Medicare Advantage ratings win, the extended Cardinal Health distribution deal and the fresh pharmacy focused rollout.
Scan how CVS Health compares with other large healthcare stocks that show strong fundamentals and potential valuation gaps through our hand picked 32 high quality undervalued stocks.
The recent pullback leaves CVS Health in a different spot from earlier this year. Is the market already pricing in the Medicare Advantage win and new pharmacy rollout, or does the current valuation still leave meaningful upside on the table?
Most Popular Narrative: 29% Undervalued
According to the most followed narrative on CVS Health, a fair value of $124 compares to the last close at $87.55, which frames the recent pullback as a valuation gap rather than a collapse in the story.
CVS Health is no longer the broken Aetna plus drugstore story the market used for most of 2024–25. Through the first half of 2026 the company has raised full-year guidance twice, Aetna’s medical benefit ratio has improved, cash flow is running well ahead of plan, and all three operating segments are growing. The stock still trades as if the insurance rebuild is temporary and the PBM is about to be regulated into irrelevance.
See why 3 investors see CVS Health as 29% undervalued.
Result: Fair Value of $124 (UNDERVALUED)
Still, the Aetna margin recovery and Medicare Advantage strength could reverse if medical costs spike or future policy and PBM reforms become more restrictive than anticipated.
Find out about the key risks to this CVS Health narrative.
Next Steps
Mixed signals on CVS Health often create the most interesting setups, so act fast, review the full picture and weigh both the 4 key rewards and 2 important warning signs.
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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.
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