CVS Health (NYSE: CVS – $99.60) reported results for the third period that missed the Street view by a penny on earnings per share but exceeded expectations on revenues. The retail drugstore and pharmacy benefits manager reported adjusted income from continuing operations of $1.33 billion, or $1.28 per share, up from $1.02 billion, or $1.15 per share, in the prior year period. Total revenues of $38.64 billion were up 10.3% from last year and topped analyst projections of $37.90 billion. Revenues in the pharmacy services segment increased 13.3% to $25.5 billion, thanks in part to growth in specialty pharmacy and pharmacy network claims. Revenues in the retail and long-term care segment increased 6.9% to $17.9 billion. About half of the increase was driven by the addition of operations acquired as part of the Omnicare acquisition in August 2015. Same store sales for the retail drugstores increased 1.7% versus the third quarter of last year, with pharmacy same store sales up 4.6%, negatively affected by introduction of a number of generic drugs. Front store same store sales declined 5.8%, but would have been higher by 4.6% if tobacco and the estimated associated basket sales were excluded from September 30, 2014, the last quarter tobacco products were sold. Front store same store sales were negatively affected by softer customer traffic, partly offset by an increase in basket size. The company narrowed guidance for the full year 2015 by raising the low-end, and now expects to deliver adjusted earnings per share of $5.14 to $5.18, up from prior guidance of $5.11 to $5.18, in line with Street estimates. For the all-important fourth quarter, CVS expects to deliver adjusted profits of $1.51 to $1.55, exceeding analysts’ estimates of $1.50. For next year, CVS Health is predicating earnings per share in a range of $5.68 to $5.88, short of analyst estimates of $5.96 and sending shares down in today’s trading. With consolidation in the industry looming by the planned acquisition of Rite Aid Pharmacy by Walgreens, 2016 can be a challenging year. However, CVS is in a strong competitive position and the acquisition of Target’s 1,660 pharmacies should provide purchasing benefits over the long-term. The shares continue to offer worthwhile risk-adjusted 3- to 5-year total return potential. Cash flow generation remains strong, giving management the financial wherewithal to continue growing the business while rewarding shareholders via share repurchases and dividend hikes.