In the past 30 days, 15 analysts have increased their earnings estimates for this drug store/pharmacy chain.
Walgreens Boots Alliance, Inc. (WBA)
From DRIP Investor
It’s no secret that Amazon.com (AMZN) has been aggressively entering markets over the last few years, much to the chagrin of legacy players in those markets. Two recent markets the firm has spotlighted are health care and shipping.
Amazon recently announced it is acquiring PillPack, which presorts medications and ships them to customers’ homes in 49 states. The company also announced that it wants to help launch small businesses dedicated to taking Amazon packages from local Amazon sorting centers to the customers who ordered them. The announcements caused selling pressures in a host of companies, including Walgreens Boots Alliance, Inc. (WBA).
Walgreens, a recent addition to the Dow Jones Industrial Average, is down nearly 23% from the stock’s 52-week high of nearly $84.
While the “Amazon effect” will likely loom over these shares, I think it is a mistake to automatically dump stocks because Amazon is threatening to become a bigger players in its market. Walgreens is a formidable competitor, and I suspect the stock will mount a comeback over time.
We have seen such comebacks in legacy players in certain industries that Amazon has entered, including retail and grocery stores. Investors looking for value in quality blue chips should take advantage of the weakness in Walgreens to buy its shares.
Walgreens offers a direct-purchase plan whereby any investor may buy the first share and every share directly from the company.
Charles A. Carlson, CFA, DRIP Investor, www.dripinvestor.com, 800-233-5922, August 2018