| Stock (Symbol) | Stock Price | |
Walgreen’s (WBA) |
$97 |
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| Data is as of | Expected to Report | Sector |
August 23, 2015 |
Oct 5 – Oct 9 |
Food & Necessities |
| Sharek’s Take | ||
 I will add Walgreens Boots Alliance (WBA) to the Growth Portfolio. On December 31, 2014 Walgreen’s merged with Alliance Boots, which is made up Boots UK, the UK’s leading pharmacy-led health and beauty retailer, and Alliance Healthcare, the largest pharmaceutical wholesaler in the UK. Since the merger, WBA has been beating analyst profit estimates, the company has been raising estimates, and the stock has been climbing. Management projected $1.5 billion in cost savings through 2017, this will help WBA continue to beat the street, and that will keep Wall Street happy. WBA is expected to grow 15% a year long-term plus pays a 2% dividend, so we are getting a possible 17% total annual return for 20x next year’s profits — a solid price for a conservative growth stock. I’m buying WBA on a dip, as the stock market is correcting and the stock has gotten down to $90. |
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| One-Year Chart | ||
 Walgreen’s was a dead stock for a while, notice the 2009-2011 profit figures. Now 2015 and 2016 look great. I bet these managements are sharing some great ideas. |
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| Earnings Table | ||
 Sales jumped 48% last qtr, which was due to the merger. Profit growth was 12%.WBA beat the street by 15 cents and has now beaten by a wide margin the past 2 qtrs. Annual Profit Estimates increased. Quarterly profit estimates look pretty decent, but I expect more cost savings will shoot these numbers higher. |
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| Fair Value | ||
 If the $90 stock (today’s quote) gets to $104 in a year that’s a 16% gain plus the 2% dividend that would be a 18% total return. The total return could eclipse 40% in two years (37% stock growth +4% from dividends). |
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| Ten-Year Chart | ||
 This hasn’t been a good decade for Walgreen’s, but the prior decade was excellent for the stock. I feel this merger has rejuvenated the company. Walgreen’s had a string of 34 consecutive years of record sales broken in 2009. |
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| Power Ranking | Bottom Line | |
Growth Portfolio
7 of 25 |
Walgreens Boots Alliance is the perfect stock to buy at this time, as the world stock markets are all in decline and we need something dependable to invest in. WBA could generate 17% total annual returns for just 20x earnings. A solid price for a great company. WBA will rank 7th in the 25 stock Growth Portfolio Power Rankings. The stock will rank 6th of 12 stocks in the Aggressive Growth Portfolio. |
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Aggressive Growth Portfolio
6 of 12 |
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