CVS Health to acquire Signify Health in an $8 billion deal, or $30.50 per share

CVS Health to acquire Signify Health in an $8 billion deal, or $30.50 per share
4 weeks ago
2 mins read

On September 5, CVS Health (NYSE: CVS) agreed to acquire Signify Health (NYSE: SGFY) for $30.50 per share in cash, for a total transaction value of roughly $8 billion. Notably, CVS beat out other potential buyers, including Amazon (NASDAQ: AMZN) and UnitedHealth (NYSE: UNH).

This new deal will allow CVS to coordinate medical care for millions of Americans through 10,000 contracted doctors and clinicians across 50 states. Furthermore, CVS Health President and CEO Karen S. Lynch claimed that the combination of these two entities would enhance their connection to consumers. 

“This acquisition will enhance our connection to consumers in the home and enables providers to better address patient needs as we execute our vision to redefine the health care experience. In addition, this combination will strengthen our ability to expand and develop new product offerings in a multi-payor approach.”

CVS chart and analysis

CVS is part of the Health Care Providers & Services industry, with 127 other stocks in this industry, it outperforms 87% of them. Over the past month, the stock traded from $97.75 to $107.26, closing above the 50-day moving average

Further, the technical analysis shows a support line at $92.87 and a resistance line at $106.61.  

CVS 20-50-200 SMA lines chart. Source. Finviz.com data. See more stocks here.

TipRanks analysts rate the shares a ‘strong buy,’ seeing the average price in the next 12 months reaching $122.33, 23.02% higher than the current trading price of $99.44. Out of the 12 TipRanks analysts covering the stock, ten have a ‘buy,’ and only two have a ‘hold’ rating.

Wall Street analysts’ price targets for CVS. Source: TipRanks  

Innovation experts.

With this acquisition, CVS keeps piling on innovation and showing that they’re a responsible custodian of human health, which was confirmed by their more recent acquisition of green, renewable energy from Constellation (NASDAQ: CEG), a 15-year commitment by CVS. 

All in all, CVS is becoming a healthcare behemoth in its industry, with a 2.21% dividend yield, or $0.55 quarterly per share, it could find its place on the list of dividend investors’ potential plays.   

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Disclaimer: The content on this site should not be considered investment advice. Investing is speculative. When investing, your capital is at risk. 

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Dino Kurbegovic

Dino is an investor and technology enthusiast with years of experience in managing complex projects. At Finbold he covers stories on stocks, investing, micro and macroeconomic trends. Also, he’s also building a micro solar power plants in his hometown.