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Walgreens Boots Alliance (WBA) Dips More Than Broader Markets: What You Should Know

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In the latest trading session, Walgreens Boots Alliance (WBA - Free Report) closed at $54.24, marking a -0.35% move from the previous day. This change lagged the S&P 500's daily loss of 0.2%.

Coming into today, shares of the largest U.S. drugstore chain had lost 1.57% in the past month. In that same time, the Retail-Wholesale sector gained 2.07%, while the S&P 500 gained 2.11%.

WBA will be looking to display strength as it nears its next earnings release, which is expected to be July 1, 2021. On that day, WBA is projected to report earnings of $1.15 per share, which would represent year-over-year growth of 38.55%. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $33.65 billion, down 2.82% from the year-ago period.

Looking at the full year, our Zacks Consensus Estimates suggest analysts are expecting earnings of $4.89 per share and revenue of $133.38 billion. These totals would mark changes of +3.16% and -4.41%, respectively, from last year.

Investors might also notice recent changes to analyst estimates for WBA. Recent revisions tend to reflect the latest near-term business trends. As a result, we can interpret positive estimate revisions as a good sign for the company's business outlook.

Our research shows that these estimate changes are directly correlated with near-term stock prices. Investors can capitalize on this by using the Zacks Rank. This model considers these estimate changes and provides a simple, actionable rating system.

The Zacks Rank system, which ranges from #1 (Strong Buy) to #5 (Strong Sell), has an impressive outside-audited track record of outperformance, with #1 stocks generating an average annual return of +25% since 1988. Within the past 30 days, our consensus EPS projection remained stagnant. WBA is currently sporting a Zacks Rank of #3 (Hold).

Looking at its valuation, WBA is holding a Forward P/E ratio of 11.14. For comparison, its industry has an average Forward P/E of 11.11, which means WBA is trading at a premium to the group.

We can also see that WBA currently has a PEG ratio of 1.63. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. The Retail - Pharmacies and Drug Stores was holding an average PEG ratio of 1.64 at yesterday's closing price.

The Retail - Pharmacies and Drug Stores industry is part of the Retail-Wholesale sector. This industry currently has a Zacks Industry Rank of 91, which puts it in the top 36% of all 250+ industries.

The Zacks Industry Rank gauges the strength of our individual 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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