After years of boosting CVS Health (NYSE:CVS) stock, I recently gave up and took a profit of 15% won over 7 months. Maybe I should have stayed in. Since I sold my CVS stock, the share price is up almost 12%.

Its recent gain is even better than that of United Healthcare (NYSE:UNH), the nation’s largest health insurer. It’s double that of the average S&P 500 index stock.

My earlier belief had been founded on the combination of the chain of CVS drug stores, its Minute Clinics for front-line care and its purchase of Aetna to provide insurance services. I believed this made CVS a low-cost health care provider. But UNH’s performance has dramatically exceeded it, the shares rising 78% over two years, against the CVS stock price’s gain of 30%.

Could that finally be turning around?

The Bull Case for CVS Stock

CVS is most often compared with Walgreens Boots Alliance (NASDAQ:WBA), which is also a retail pharmacy chain, but with an added kicker of a huge U.K. business.

That comparison became moot in 2018, when CVS agreed to put $78 billion into Aetna, a lagging health insurer. The deal came after years of efforts by Aetna, Cigna (NYSE:CI), Humana (NYSE:HUM) and Anthem (NYSE:ANTM) to merge with each other and compete with United Health, which dominates the market thanks to strong technology.

I believed analysts were missing the cost savings from the CVS-Aetna combination, which created a company with revenues close to those of UNH. I wrote that CVS was poised to ride the wave of managed care, where the emphasis is on keeping people healthy rather than treating their sickness.

But under CEO Karen Lynch, who replaced Larry Merlo in February, results have improved. Third quarter revenue of $73.8 billion was 10% ahead of 2020. Adjusted earnings per share were up 18.7%.

More gains should be coming. CVS is returning to the military’s Tricare pharmacy network after five years, replacing Walmart (NYSE:WMT). The connection between Aetna and the CVS retail chain is being made more explicit in the drug stores’ marketing.

Lynch has also launched a “virtual primary care” program, bringing real doctors into its clinics by computer. Lynch will scale that program nationally in 2022.

Next year could be very, very good for CVS Health.

Trouble in Store

But there remain problems. Workers in California are threatening to strike over pay. Organized gangs are raiding CVS stores, stealing up to $2,000 in merchandise in two minutes, then fencing it through third-party sellers on Amazon (NASDAQ:AMZN).

Meanwhile, CVS expects more trouble from Amazon, which is creating home healthcare services that CVS lacks and the “everything store” already owns an online pharmacy called PillPack. You “underestimate Amazon at one’s own peril,” a CVS executive said recently. I call that good paranoia.

CVS’ policy of pushing patients toward its Caremark pharmacy benefit manager is also under threat at the U.S. Supreme Court . Disability rights activists accuse it of trying to gut protections for the disabled. Even if CVS wins, the publicity blowback could be fierce.

The Bottom Line

Lynch, who came to CVS with Aetna, has put a vaccine mandate on employees and has high hopes for the pharmacies’ HealthHubs. These aim to treat chronic diseases that represent 75% of the nation’s health care bill.

She talks a good game, but so did Merlo. Maybe she’ll have more success approaching the problem from the insurance side rather than the pharmacy.

Personally, I’m rooting for her. With a price-to-earnings (PE) ratio of 16.5, and a dividend yielding 2.12%, CVS stock may be worth betting on again. But until Lynch can prove otherwise, UNH will remain the better wager.

On the date of publication, Dana Blankenhorn held a long position in AMZN. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.

Dana Blankenhorn has been a financial and technology journalist since 1978. Just in time for the holiday season, he has a collection of COVID-19 stories at the Amazon Kindle store. Write him at danablankenhorn@gmail.com or tweet him at @danablankenhorn. He writes a Substack newsletter, Facing the Future, which covers technology, markets, and politics.