Walgreen Co. Message Board

MISM is starting to move. Do your DD asap!

WAG used to be $20+ ahead of CVS

WAG is a LAGGard

BWAAAHHAHAHAAAA

Walgreen will Make a Presentation (one day before EX-Dividend Date) at Bank of Amer / Merrill Lynch- Health Care Conf. on 5/16/13.
Payout 2.30% Yield

Sentiment: Strong Buy

"The bottom line

Walgreen currently seems to be a much better investment than CVS when considering future prospects. Its huge deal with AmerisourceBergen gives it economies of scale that beat CVS.

While Walgreen is already the largest drugstore in the U.S., its strategic deal with Alliance Boots gives it a huge head start internationally over CVS and cements its place as the first-and-largest global drugstore in the world--now with a heavy presence in Europe and a growing foothold in emerging markets.

When looking at valuations, both companies look expensive if considering trailing P/E ratios, and look cheap going forward when keeping annual estimated earnings in mind. Walgreen distinguishes itself from CVS, however, with its explosive dividend growth and track record over the years. If I'm going to pay the same price relative to earnings, I want the better option between the two.

Walgreen is set up nicely to be the dominant global drugstore, and it will be hard to knock it down. If CVS retains 60% of Walgreen's former customers from the Express Scripts fallout, Walgreen might not notice much 10 years down the road. CVS appears to be attempting to play checkers in a chess game, while Walgreen is already setting up for the check-mate.

CVS might still make a good play to capitalize on U.S. demographics and Obamacare, but Walgreen (as of now at least) is king of the drugstore castle. It will be hard for another company to dethrone an already well-established, global leader-- and this is why I believe Walgreen will most likely continue to outperform."

Some things never change.

Drug wholesaling locked up in Europe and many parts of Asia for Walgreens, and now begins the partnership and part ownership of Amerisource Bergen in the USA. How can the other players compete with this?

Walgreen Remains the Leader

Walgreen runs the largest network of retail drugstores in the U.S. The outfit offers an array of consumer goods and services, pharmacy, and health and wellness services. Walgreen has a market cap of $45.5 billion and a P/E ratio of 21.4 - above the S&P 500 P/E ratio of 17.7. Shares are up by more than 29% so far in 2013.

The drug chain is strong in a number of areas including climbing net income, steady cash flows, and a sound financial position overall. Moreover, Walgreen has a history of solid share price performance and continued growth in earnings per share.

The company recently reported results for the first quarter and sales are up about 3.8% to just under $6 billion. Walgreens’ total pharmacy sales accounted for much this rise - more than 64% of total sales. But total front-end sales declined 2.9% compared with the first quarter of 2012.

In short, Walgreen’s prescription drug sales have climbed for two straight months and are likely to continue. The share price is now hovering at $49+, far higher than the 52 week low of $28.50. At this price, it could be time to take some money off the table; but growing Rx sales numbers going forward make Walgreen a good long-term buy.

Sentiment: Strong Buy