Walgreens Boots Alliance Faces Tough Times Amid Competitive Pressures
Based in Deerfield, Illinois, Walgreens Boots Alliance, Inc. (WBA) is a major player in the pharmacy and healthcare sector, boasting a market cap of $8 billion. The company offers a variety of health and wellness products and services, reaching millions of customers globally through its extensive retail and online channels.
Stark Contrast to Market Performance
Over the past year, shares of Walgreens Boots have sharply lagged behind the broader market. WBA has fallen 57.2% during this period, while the S&P 500 Index ($SPX) has gained nearly 36.4%. In 2024, WBA stock is down 64.5%, contrasting with a 25.3% increase for the SPX on a year-to-date basis.
Underperforming Against Industry Rivals
Focusing further, WBA’s performance falls short when compared to the Vanguard Health Care Index Fund ETF Shares (VHT), which boasts 9.8% YTD returns.
Recent Market Developments
On October 22, Walgreens Boots Alliance saw its shares decline 7.2% after Walmart announced same-day prescription delivery, intensifying competition from both Walmart and tech-savvy retailers like Amazon.
Conversely, WBA stock experienced a 15% surge on October 15 after reporting Q4 sales of $37.55 billion, surpassing expectations of $35.56 billion. The company also forecasted 2025 sales between $147 billion and $151 billion, topping the consensus estimate of $146.9 billion.
An Uncertain Earnings Outlook
For the current fiscal year ending in August 2025, analysts anticipate WBA’s EPS to decrease 46.9% year over year, projecting it at $1.53 on a diluted basis. The company’s earnings surprise history has been mixed, having exceeded estimates in three of the last four quarters while missing forecasts once.
Analysts’ Consensus and Price Targets
Among the 15 analysts tracking WBA stock, the consensus rating remains a “Hold.” This includes two “Strong Buy” ratings, ten “Holds,” one “Moderate Sell,” and two “Strong Sells.”
Revising Forecasts
This advisory has remained steady over the past month. On October 23, Jefferies analyst Brian Tanquilut revised Walgreens Boots Alliance’s price target to $9 from $19, citing ongoing fundamental challenges despite recent stock gains. He also mentioned that potential asset sales could positively impact the company’s cash flow and overall value.
The average price target now stands at $10.23, indicating a 10.4% potential upside from WBA’s current price. The highest price target among analysts is set at $15, suggesting an upside potential of 61.8%.
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On the date of publication, Rashmi Kumari did not hold (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article are for informational purposes only. Please view the Barchart Disclosure Policy here.
The views and opinions expressed herein are those of the author and do not necessarily reflect those of Nasdaq, Inc.
