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  • Alba95 Alba95 Aug 8, 2010 1:48 PM Flag

    Cvs vs WAG

    It seems like WAG has a better balance sheet and yet the analyst favor CVS.Any input on this?

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    • In an age when individuals, corporations and Federal and State governments are swamped with debt up to their eyeballs, I prefer to invest in companies who have a little breathing room when it comes to corporate debt. WAG fits that bill. Rite Aid and CVS do not. The best economists in the nation have sharply different outlooks on the future growth of the economy. They also have different views on how to bring down deficit spending and Federal debt. Anyone who believes that 15 million people are going to quickly be reemployed may be disappointed. Eventually the benefits will run out and retail business will feel the pinch. JMHO

    • CVS uses their balance sheet better and they are taking market share.

      WAG has a solid balance sheet, but losing market share, no future growth, etc.

      If you investing in this space look to PBMs for growth.

      check out drugchannels has nice info on market share, etc.

      • 1 Reply to cmxgen
      • Cmxgen: you are not being fair here,
        Walgreens has market share, it's just Rx profit that is in question.

        Walgreens Exec's have slowed store growth or said they would which effects SG&A.

        Walgreens also reduced Store labor costs with their CCR.. also Rx costs, with power. What-ever that stands for.
        Now if they get their Corporate and field labor costs down.. and sign one or two preferred relationship contracts with payors that could improve net earning.

        Having a Risk strategy in this direction takes experience, as you Know.
        So if a short fall exists, you need to
        look at strategic direction in Risk management and experience in negotiations.