CVS Health (CVS) stock surges after the company’s quarterly results and an update on leadership with Steve Nelson, a former CEO of UnitedHealth Group’s insurance division, stepping up as the Aetna unit president. Jefferies healthcare services equity research analyst Brian Tanquilut joins Seana Smith and Brad Smith to discuss these figures.

“I think you know the stock's reacting well partly because of the elections, but also, I think they gave some insight into how we're thinking about 2025.” He says, “What we're taking away from it is that management here, while they don't have a lot of visibility into how 2024 will shake out, even though we're a month and a half away from year-end. The fact that they pointed to all these moving pieces that will drive growth in theory for next year, in terms of improvement in margins, in terms of bonus payments that they're going to get from the government, all pointing to [earnings per share] EPS growth in 2025. I think that's how the market is reading that, and that's why we're seeing a positive reaction in CVS now."

On Nelson taking the lead of CVS’s insurance unit, the analyst says, “New management is not a bad thing. I think Steve Nelson has proven himself as a leader both at United and in other stops that he's had before taking this position … it feels like they have a plan in place, and it's just a matter of execution. And also some improvement in the macro stuff.”

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This post was written by Naomi Buchanan.