Morgan Stanley Maintains Equal-Weight on CVS Caremark

Morgan Stanley is out with its report today on CVS Caremark CVS, maintaining Equal-weight. In a note to clients, Morgan Stanley writes, "The California Public Employees' Retirement System announced after the close that it has awarded a 3 year contract worth $565M annually to CVS/ Caremark to manage its prescription drug benefits. We estimate that this could add $0.03 to CVS 2012 EPS. The contract will begin on January 1, 2012 and last for 3 years with a 2-year option for extension. As it was announced earlier this year that CalPERS was not going to renew its existing contract with Medco, we believe many investors were already counting CVS as the likely winner." At the time of posting, shares of CVS were trading pre-market at $38, up 1.36% from Monday's close.