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Walgreens Boots Alliance (WBA) Gains But Lags Market: What You Should Know

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Walgreens Boots Alliance (WBA - Free Report) closed the most recent trading day at $52.74, moving +0.3% from the previous trading session. This change lagged the S&P 500's 0.58% gain on the day. At the same time, the Dow added 0.45%, and the tech-heavy Nasdaq gained 1.13%.

Heading into today, shares of the largest U.S. drugstore chain had lost 4.12% over the past month, lagging the Retail-Wholesale sector's loss of 2.95% and the S&P 500's loss of 2.34% in that time.

WBA will be looking to display strength as it nears its next earnings release. On that day, WBA is projected to report earnings of $1.43 per share, which would represent a year-over-year decline of 6.54%. Meanwhile, our latest consensus estimate is calling for revenue of $34.54 billion, up 0.61% from the prior-year quarter.

For the full year, our Zacks Consensus Estimates are projecting earnings of $5.99 per share and revenue of $136.77 billion, which would represent changes of -0.5% and +3.98%, respectively, from the prior year.

Any recent changes to analyst estimates for WBA should also be noted by investors. These revisions help to show the ever-changing nature of near-term business trends. With this in mind, we can consider positive estimate revisions a sign of optimism about the company's business outlook.

Research indicates that these estimate revisions are directly correlated with near-term share price momentum. We developed the Zacks Rank to capitalize on this phenomenon. Our system takes these estimate changes into account and delivers a clear, actionable rating model.

The Zacks Rank system ranges from #1 (Strong Buy) to #5 (Strong Sell). It has a remarkable, outside-audited track record of success, with #1 stocks delivering an average annual return of +25% since 1988. The Zacks Consensus EPS estimate remained stagnant within the past month. WBA is currently a Zacks Rank #4 (Sell).

In terms of valuation, WBA is currently trading at a Forward P/E ratio of 8.77. Its industry sports an average Forward P/E of 8.77, so we one might conclude that WBA is trading at a no noticeable deviation comparatively.

Meanwhile, WBA's PEG ratio is currently 1.07. 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. The Retail - Pharmacies and Drug Stores was holding an average PEG ratio of 1.04 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 254, which puts it in the bottom 1% 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.

Be sure to follow all of these stock-moving metrics, and many more, on Zacks.com.


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