On Apr. 4, when stocks were being pummeled and the Dow Jones industrial average and Nasdaq index were cratering, CVS, the nation's No. 1 retail drug chain, went the other direction. It was one of the winners that day, closing at 40 5/8 a share, up 17/16. The stock had been rising since early March, when it was down to 25. One reason: CVS is soon scheduled to roll out nationwide its specialty Procare stores. These are big-city pharmacies that cater to people with HIV, cancer, and other high-cost ailments. Two Procare outlets, which are staffed with highly trained pharmacists to deal with acute-care patients, have opened in New York.

"We expect the Procare pharmacies to generate sales of $1 billion a year," says Mark Husson, an analyst at Merrill Lynch, who rates CVS a long-term buy. This specialty market, he says, has potential sales of $11 billion a year. "CVS is my single best idea in the universe of stocks that I cover," says Husson. "CVS is in an excellent position," he says, because it has special access to three HMOs: Medco, which covers 51 million people, United Healthcare, with 8 million, and Pharmacare, with 6 million. CVS' online unit, CVS.com, has signed up with Merck and Healtheon/WebMD to be their exclusive electronic pharmacy. Husson expects CVS to earn $1.79 a share this year and $2.08 next, up from 1999's $1.55.

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