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  • henleywm henleywm Oct 17, 2013 8:37 PM Flag

    What to expect from Walgreens in 2016?

    CEO, Greg Wassom has stated that 2016 revenues will be $130 Billion. Currently, analyst estimates are for revenues of $75.58 Billion in 2014 and $79.34 Billion in 2015. That would leave us looking for an increase of $50 Billion in 2016. For the next 5 years analysts have predicted WAG to grow revenues 12.95%, which leaves me wondering how they can estimate only 4.6% and 4.7% for the next two years. Clearly these predictions are inconsistent. For WAG to turn in revenues of $130 Billion for year end Aug 2016 they will need to average 22% annual growth. We know Obamacare will add significantly to drugstore and in-store clinic revenues. We know Walgreens will complete the acquisition of Boots in 2015. We know Walgreens is buying 7% of ABC on the open market and will be buying another 16% through discounted options in 2015 and 2016 for a total ownership of about 23% of ABC (Amerisource Bergen market cap of $14.9 Billion). We know Walgreens is moving aggressively into the specialty pharmacy business. We know Walgreens is moving aggressively into the laboratory testing business. Walgreens has been consistently buying up regional chains and independent pharmacies in the U.S. . Boots is moving aggressively into Asia, Turkey and Germany. Can all of this add up to 22% annual growth? Walgreen longs are in for a great ride and it will be interesting to watch how well the company can execute their ambitious plans.

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