Walmart’s Virtual Health Failure Spells Opportunity for CVS Health: Insights into the Evolving Healthcare Industry

Walmart (WMT) has recently announced the closure of 51 health centers and the discontinuation of its virtual care services, citing a lack of sustainable business model for the retail giant. This decision came shortly after news that UnitedHealth (UNH) would also be shutting down its Optum virtual health business.

The lack of success with Walmart Health Centers is seen as a positive for CVS Health (CVS), which fully embraced the health center model after acquiring Aetna in 2017. Despite the closure of the health centers, Walmart still maintains nearly 4,600 pharmacies in its stores and has been expanding their range of services. The company also operates over 200 vision centers.

In contrast to Walmart’s struggles with virtual care, Amazon (AMZN) has been more aggressive in the health clinic business following its $3.9 billion acquisition of One Medical. There were rumors circulating during this time that Walmart may acquire Humana (HUM). However, these rumors did not come to fruition.

The retreat from virtual care by UnitedHealth and Walmart reflects the challenges faced by companies like Teladoc (TDOC) in the rapidly evolving healthcare industry. As companies continue to grapple with how to provide effective and cost-efficient healthcare services, investors will need to keep a close eye on trends and developments in this space.

In stock market activity, Walmart’s stock dipped slightly, while Amazon and CVS saw modest gains. Investors may consider a move past 60.89 as an early entry opportunity for Walmart stock given its recent dip below this key resistance level. For more information on stock market trends and trading decisions, be sure to read IBD’s The Big Picture column and join IBD Live each morning for stock tips before the market opens. To enhance your trading strategy with access to premium lists, tools, and analysis, consider subscribing to IBD Digital today