Stocks on Trader’s Radar -Walgreens Boots Alliance Inc (NASDAQ:WBA)
On Wednesday, Walgreens Boots Alliance Inc (NASDAQ:WBA) showed bearish trend with lower momentum of -1.61% to close at $81.17. The company traded total volume of 12.12 million shares as contrast to its average volume of 3.18 million shares. The company has a market value of $87.14 billion and about 1.08 billion shares outstanding. During the 52-week trading session the minimum price at which share price traded, registered at $75.74 and reached to max level of $88.00.
Walgreens Boots Alliance, Inc. (WBA) recently declared financial results for the second quarter of fiscal 2017, which ended 28 February 2017.
Overview of Second Quarter Results:
Fiscal 2017 second quarter net earnings attributable to Walgreens Boots Alliance determined in accordance with GAAP raised 14.0 percent to $1.10B contrast with the same quarter a year ago, while GAAP diluted net earnings per share raised 15.30 percent to $0.98 contrast with the same quarter a year ago. The increases in GAAP net earnings and GAAP net earnings per share mainly reflect the reduction in the fair value of the company’s AmerisourceBergen Corporation warrants in the year-ago quarter, partially offset by higher costs related to the company’s cost transformation program in the quarter.
Adjusted fiscal 2017 second quarter net earnings attributable to Walgreens Boots Alliance raised 3.70 percent to $1.50B, up 6.20 percent on a constant currency basis, contrast with the same quarter a year ago. Adjusted diluted net earnings per share for the quarter raised 3.80 percent to $1.36, up 6.10 percent on a constant currency basis, contrast with the same quarter a year ago.
Sales in the second quarter were $29.40B, a decrease of 2.40 percent from the year-ago quarter, and a boost of 0.90 percent on a constant currency basis. Apart from the impact of the leap year in 2016, sales raised 2.20 percent on a constant currency basis.
GAAP operating income in the second quarter was $1.50B, a decrease of 20.50 percent from the same quarter a year ago, mainly because of costs related to the company’s cost transformation program. Adjusted operating income in the second quarter was $2.0B, a decrease of 4.90 percent from the same quarter a year ago, and a decrease of 2.70 percent on a constant currency basis.
GAAP net cash offered by operating activities was $2.90B in the second quarter, a boost of $504.0M from the same quarter a year ago, and free cash flow was $2.60B, a boost of $560.0M.
Overview of Fiscal 2017 First Half Results:
Fiscal 2017 first half net earnings attributable to Walgreens Boots Alliance determined in accordance with GAAP raised 3.60 percent to $2.10B contrast with the same period a year ago, while GAAP diluted net earnings per share raised 3.70 percent to $1.94 contrast with the same period a year ago.
Adjusted net earnings attributable to Walgreens Boots Alliance1 for the first six months of fiscal 2017 raised 4.80 percent to $2.70B, up 7.10 percent on a constant currency basis, contrast with the same period a year ago. Adjusted diluted net earnings per share for the first six months of fiscal 2017 raised 5.10 percent to $2.46, up 7.70 percent on a constant currency basis, contrast with the same period a year ago.
Sales reduced 2.10 percent to $57.90B in the first six months of fiscal 2017 contrast with the same period a year ago. On a constant currency basis, sales raised 1.0 percent.
GAAP operating income in the first half of fiscal 2017 was $2.90B, a decrease of 12.10 percent from the same period a year ago. Adjusted operating income in the first half of the fiscal year was $3.70B, a decrease of 2.50 percent from the same period a year ago, and a decrease of 0.30 percent on a constant currency basis.
GAAP net cash offered by operating activities was $3.40B in the first half of fiscal 2017, a boost of $297.0M from the same period a year ago, and free cash flow was $2.70B, a boost of $315.0M.
Cost Transformation Program:
The company achieved $1.50B in savings from its formerly declared cost transformation program ahead of plan. The program is on track to be accomplished by the end of fiscal 2017, as formerly declared. Accordingly, full program benefits will be recognized in subsequent periods. The company now anticipates total pre-tax charges associated with this program to its GAAP financial results will be about $1.80B, consistent with the upper end of the predictable range when the expanded program was declared in April 2015.
Rite Aid Acquisition:
As declared 30 January 2017, Walgreens Boots Alliance and Rite Aid Corporation reached an amendment and extension of their merger agreement, which was originally declared 27 October 2015. Walgreens Boots Alliance continues to be actively engaged in negotiations with the Federal Trade Commission (FTC) regarding the pending acquisition, and the extension of the end date of the agreement to 31 July 2017 allows the parties additional time to obtain regulatory approval. The transaction is subject to approval by the holders of Rite Aid’s common stock, the expiration or termination of applicable waiting periods under the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended, and other customary closing conditions.
Walgreens Boots Alliance continues to expect that it will realize synergies from the acquisition of Rite Aid in excess of $1.0B, to be fully realized within three to four years of the closing of the merger. These synergies, as formerly revealed, are predictable to be derived mainly from procurement, cost savings and other operational matters.
Share Repurchase Program:
On 3 April 2017 the company authorized a share repurchase program for up to $1 billion of the company’s shares before the program’s expiration on 31 December 2017.
Company Outlook:
The company maintained its guidance for fiscal 2017 and continues to expect adjusted diluted net earnings per share of $4.90 to $5.08.
As formerly revealed on 30 January 2017, the company no longer anticipates any material accretion from Rite Aid in fiscal 2017. Moreover, this guidance assumes current exchange rates for the rest of the fiscal year.
The Company offered net profit margin of 3.50% while its gross profit margin was 25.20%. ROE was recorded as 13.80% while beta factor was 1.27. The stock, as of recent close, has shown weekly downbeat performance of -3.10% which was maintained at -1.48 % in this year.