CVS Health Corp (NYSE: CVS ) stock jumped more than 2 percent on Thursday morning after the company topped fourth-quarter earnings expectations and announced it would be raising pay for its employees.

CVS reported adjusted earnings per share of $1.92 on revenue of $48.39 billion in the fourth quarter. Both numbers topped analyst expectations of $1.89 and $45.97 billion, respectively.

CVS reported net income of $3.22 per share, but got a $1.5 billion boost from tax reform and took a $56 million hit from charges related to its pending buyout of Aetna Inc ( AET ).

[See: 7 of the Best Stocks to Buy for 2018 .]

CVS also says it will raise hourly wages for all its employees to $11 starting in April and will be offering all full-time employees four weeks of paid parental leave. The company says another wave of pay adjustments for higher-level employees is coming later in the year. CVS is also using part of its tax cut savings to make a $425 million annual commitment to employee benefits and plans to use the rest of its savings to invest in data analytics to help improve business performance and pay down debt to improve its balance sheet.

“Today, we're building on the investments we've been making in our employees, in their wages, benefits and career development," CEO Larry Merlo says in a statement. "It's our employees who drive our performance and we appreciate how hard they work every day to deliver on our purpose of helping people on their path to better health.”

While CVS stock got a boost on Thursday, the stock has struggled recently after numerous reports that Amazon.com, Inc. ( AMZN ) could be taking aim at the pharmacy business as its next major target. In January, Amazon announced a new partnership with J.P. Morgan Chase & Co. ( JPM ) and Berkshire Hathaway Inc. ( BRK.A , BRK.B ) to create a new health care company with the goal of providing more affordable care for the three companies’ employees.

[See: 7 Big Pharma Stocks to Buy for Big Dividends .]

CVS stock is down 6 percent in the past six months.

Compare Offers

Compare Offers