(Reuters) -Activist investor Glenview Capital said on Tuesday it had reduced its holdings in CVS Health following the insurer’s “healthy” first-quarter results.
CVS shares have generated a total return of 25% since it took a position last year, suggesting progress in the company’s turnaround plan, the hedge fund said.
Glenview previously owned nearly 12 million shares of CVS, according to its latest regulatory filing. It reduced its holdings by 3.75 million shares, just days after the healthcare conglomerate raised its annual forecast and beat Wall Street estimate for quarterly profit.
CVS had been facing pressure from investors, including Glenview, to improve its operations and shareholder value after missing financial targets several times due to increased medical costs in its health insurance business.
In October, CVS replaced CEO Karen Lynch with company veteran David Joyner and a month later added Glenview’s top boss and three others to its board.
Joyner has since laid out cost-cutting plans and reshuffled the top management to help the company navigate one of the most challenging periods in its six-decade history.
Glenview said it has no plans for additional adjustments to its holdings with the company.
“Our confidence in the near, medium and long-term outlook for CVS remains strong,” the hedge fund said.
Last week, CVS raised its 2025 profit forecast to $6 to $6.20 per share, from $5.75 to $6 projected previously. It also reported first-quarter profit above analysts’ estimate on lower-than-expected medical costs.
(Reporting by Christy Santhosh in Bengaluru; Editing by Shilpi Majumdar)
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