Walgreens Boots Alliance (WBA) Outpaces Stock Market Gains: What You Should Know

Walgreens Boots Alliance (WBA) closed at $40.89 in the latest trading session, marking a +1.09% move from the prior day. This change outpaced the S&P 500's 0.95% gain on the day. At the same time, the Dow added 0.64%, and the tech-heavy Nasdaq gained 0.12%.

Heading into today, shares of the largest U.S. drugstore chain had lost 4.73% over the past month, lagging the Retail-Wholesale sector's gain of 2.16% and the S&P 500's loss of 3.49% in that time.

Investors will be hoping for strength from Walgreens Boots Alliance as it approaches its next earnings release, which is expected to be June 30, 2022. In that report, analysts expect Walgreens Boots Alliance to post earnings of $0.95 per share. This would mark a year-over-year decline of 37.09%. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $32.74 billion, down 3.8% from the year-ago period.

For the full year, our Zacks Consensus Estimates are projecting earnings of $5.06 per share and revenue of $132.74 billion, which would represent changes of -4.71% and -3.38%, respectively, from the prior year.

Investors might also notice recent changes to analyst estimates for Walgreens Boots Alliance. These recent revisions tend to reflect the evolving nature of short-term business trends. With this in mind, we can consider positive estimate revisions a sign of optimism about the company's business outlook.

Our research shows that these estimate changes are directly correlated with near-term stock prices. To benefit from this, we have developed the Zacks Rank, a proprietary model which takes these estimate changes into account and provides an actionable rating system.

Ranging from #1 (Strong Buy) to #5 (Strong Sell), the Zacks Rank system has a proven, outside-audited track record of outperformance, with #1 stocks returning an average of +25% annually since 1988. Over the past month, the Zacks Consensus EPS estimate remained stagnant. Walgreens Boots Alliance is holding a Zacks Rank of #3 (Hold) right now.

In terms of valuation, Walgreens Boots Alliance is currently trading at a Forward P/E ratio of 8. This valuation marks a no noticeable deviation compared to its industry's average Forward P/E of 8.

Also, we should mention that WBA has a PEG ratio of 1.6. The PEG ratio is similar to the widely-used P/E ratio, but this metric also takes the company's expected earnings growth rate into account. WBA's industry had an average PEG ratio of 1.52 as of yesterday's close.

The Retail - Pharmacies and Drug Stores industry is part of the Retail-Wholesale sector. This group has a Zacks Industry Rank of 188, putting it in the bottom 26% of all 250+ industries.

The Zacks Industry Rank gauges the strength of our industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

You can find more information on all of these metrics, and much more, on Zacks.com.

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