Walgreens Boots Alliance Inc (WBA)

[JJ8]

Prudent Capitalist: thanks for the information. Yes. That makes it clear for today's "implosion" in the share price. GLTY

[Prudent Capitalist]

Today's drop is News driven;

Walgreens Boots Alliance Hit With IRS $2.7 Billion Tax Claim
Caleb Harshberger
April 1, 2024, 11:39?AM CDT

The IRS is seeking $2.7 billion in unpaid taxes from Walgreens Boots Alliance due to alleged issues over transfer pricing, following audits of previous tax years, the company reported in recent filings.

The agency issued a Revenue Agent’s Report last quarter, saying it had audited the company’s 2014 to 2017 tax years, filings said. The agency found issues related to transfer pricing and is seeking an additional $2.7 billion plus penalties and interest.

Walgreens Boots Alliance, which owns two major retail pharmacy chains — Walgreens in the US and Boots in the UK—said it disagrees with the report and plans to appeal, filings say, and that could take more than a year to resolve.

“The Company intends to vigorously defend its position on the transfer pricing matter through the IRS’s administrative appeals office and, if necessary, judicial proceedings and is confident in its ability to prevail on the merits,” filings said.

Walgreens Boots Alliance didn’t immediately respond to a request for comment.

https://news.bloomberglaw.com/daily-tax-report/walgreens-boots-alliance-hit-with-irs-2-7-billion-tax-claim

[biotech_researcher]

Sure

[JJ8]

A sudden WBA share price implosion followed: WBA share price had a TRIPLE BOTTOM BREAKDOWN today, on 01-April-2024.

I have no shares in the company and no plans to buy any.

The good news is that my Google shares are flying and a new yearly high occurred. GLTY & GLTA

[biotech_researcher]

I don’t think so………

[JJ8]

Walgreen share price DOUBLE TOP BREAKOUT yesterday, on 28-March-2024. GLTA

[Prudent Capitalist]

Walgreens has seriously reduced staffing in its pharmacies and is now filing a significant percentage of prescriptions from regional distribution center operations several states away and shipping them into the pharmacies. I have had it take 3 days to get a script, and then when it comes it is only a 30-day fill instead of the 90-days that it is re-filling, and then the 30 little tablets come in a huge wide bottle such that the 30 pills do not even cover the bottom. SMH..

[Prudent Capitalist]

WBA stumbled on the Boots acquisition. CVS dividend yield is just 3.27%, but WBA's will be only 4%or so after the significant cut and WBA's yield is inflated on a percentage basis due to the low stock price.

[bar1080]

Infuriating waiting in a checkout line behind smelly toothless idiots buying cigarettes and lottery tickets. I encounter that at my gas station.

[Stock_Barber]

What explains the outperformance of CVS

Attempted wokeism and DEI at WBA...

It only takes one unqualified CEO to almost destroy a company! Several on the BOD need to go as well...

Those days are over!

👢

[Lokotony]

Yeah, I don't believe that makes ANY difference. IMHO

[bar1080]

One stark difference: CVS stopped selling cigarettes in 2014. WBA still sells them. .

https://www.cnbc.com/2021/10/14/walgreens-tobacco-sales-under-real-scrutiny-new-ceo-roz-brew-says-.html

[bar1080]

WBA lags CVS by miles according to all the major metrics. Here's CVS' recent quarterly dividends which are still growing nicely. What explains the outperformance of CVS?

Date	Dividends 
 Oct 19, 2023	0.605 Dividend 
 Jul 20, 2023	0.605 Dividend 
 Apr 20, 2023	0.605 Dividend 
 Jan 19, 2023	0.605 Dividend 
 Oct 20, 2022	0.55 Dividend 
 Jul 21, 2022	0.55 Dividend 
 Apr 21, 2022	0.55 Dividend 
 Jan 20, 2022	0.55 Dividend 
 Oct 21, 2021	0.50 Dividend 
 Jul 22, 2021	0.50 Dividend 
 Apr 22, 2021	0.50 Dividend 
 Jan 21, 2021	0.50 Dividend

[Saving Grace]

Right on, I got out yesterday. Good Luck

[Prudent Capitalist]

That had been raised as a possibility. The current dividend is 8% at today's share price and that is rich for a stock like this. But anything in the 4% range is not chicken feed and should benefit the share price. This company has badly needed new executive leadership since the Stephano Pessina debacle after the Boots merger. Nothing has been the same since the old WAG days pre-Boots.

[Stock_Barber]

Actually, I think it was pretty much expected, even though they had never cut it before.

The previous CEO sucked. So much for the strategy of hiring a diversity candidate vs. the best qualified! Anyway, that's in the past...

No worries. I'll still be holding my core position a decade from now.

[Saving Grace]

I was hoping to build on the dividend but the cut isn't looking good at all.

What else will they cut next? Stores? Big Pharma is projected to cave with new health discoveries coming out with breakthrough all natural treatments and remedies.

[bar1080]

Walgreens Just Slashed Its Dividend. Stock Is Plunging

"Shares of Walgreens Boots Alliance fell by more than 10% after the pharmacy chain said it is cutting its quarterly dividend by nearly half. Walgreens shares initially jumped 2.4% in premarket trading following the announcement, but tumbled 11% as the regular session began. Adjusted earnings for the first quarter of Walgreens’ fiscal year, disclosed along with the news of the dividend cut, were 66 cents a share, beating the 62 cents a share consensus estimate among analysts tracked by FactSet, and down from $1.16 a share in the same quarter last year."

https://finance.yahoo.com/m/ee25515a-b35b-34e4-8abb-923112313e77/walgreens-just-slashed-its.html

[Lokotony]

One of the reasons I invested in it.....they were one of the few that kept it fat.....now lose half the div and our SP getting demolished.

[Saving Grace]

Great? They just cut the dividend 48% SMH

[Prudent Capitalist]

The dividend here is great, but they need to get the ship back on track. Ever since WAG let itself be taken over by the boots Alliance and Stephano Pessina, things went south. Reinvesting the fat dividends down here helps with the cost averaging on the positions.

[bar1080]

Still holding in my kids' account. My main investment method is to buy the highest quality div-paying blue chips and almost never sell. That doesn't always work, but it works over half the time. I'm certainly not adding or reinvesting dividends. BTW, current WBA div yield is 7.49% according to Finviz today..

[Lokotony]

Just bought.....LET this be a winner!

[Stock_Barber]

Yes indeed!

[Prudent Capitalist]

But a nice share price recovery here this week for WBA.

[Afterhoursearnings3]

Amid what now? Lol I bought today, if the divi holds this is a gem

[bar1080]

Just realized WBA is touching a recent low, a terrible sign amid a generally strong economy.

[bar1080]

Both Yahoo finance and Finviz give Walgreen's current dividend yield at 9.24% which I take as a huge red flag for danger. I'm certainly not adding and I don't reinvest dividends. It's in my kids' accounts, but just a small portion. Their accounts are well diversified including several index funds, notably the red hot QQQ they've had since about 2010.

[Stock_Barber]

I have effectively the same position! DRIPs are awesome!

[Prudent Capitalist]

I have held a substantial position here for years in a tax-deferred retirement account and have always reinvested all dividends. Not happy with the current share price, but the value of the position is still way above the original $$$$$ outlay of the investment. And, currently WBA's dividend is 9.2% at the current share price.

[Stock_Barber]

I am VERY heavily loaded here, and also very optimistic for the years ahead!

Don't fight the Fed, and don't fight aging Boomer trends!

.

[Prudent Capitalist]

Hopefully WBA maintains the dividend at this level going forward. They will not want to give up that Dividend Aristocrat status, and WBA should pick up market share with RAD filing for Chapter 11 bankruptcy yesterday and announcing that it will be closing a bunch more stores.

[Stock_Barber]

Same! Dividend always makes a bottom!

Where else is one going to get 9% with a company of Walgreen's caliber?

[IPO$]

Nice 9% dividend.

[Afterhoursearnings3]

Close to here imo. Grabbed a few hundred shares yesterday. Will add if drops more

[IPO$]

Where’s the bottom?

[IPO$]

Falling knife.

[Stock_Barber]

The UK.

[IPO$]

Where did the “boots” name come from?

[IPO$]

I am new to this stock. Why is it down so much this year? It looks like it has a 9% dividend yield at this price.🏈🏀⚽️

[Prudent Capitalist]

I agree, But the share price here was essentially destroyed by here predecessor, Stefano Pessina. the Boots Alliance merger was and continues to be a total disaster.

[Stock_Barber]

I'm actually happy to see her go! Part of a CEO's job is the share price! And based on that ALONE, she should have been shown the door!

What do you think about her departure?

[bar1080]

"What’s behind Walgreens CEO Roz Brewer’s abrupt departure?

https://www.msn.com/en-us/money/companies/what-s-behind-walgreens-ceo-roz-brewer-s-abrupt-departure/ar-AA1ggQaL

" Abrupt exit. The supposedly sleepy Labor Day weekend began with a bang on Friday morning, when Walgreens abruptly announced that CEO Roz Brewer had stepped down and left its board, effective the day before (Aug 31).

The decision was “mutually agreed” upon by Brewer and Walgreens’s board, the company said. Brewer, who had been in the job for less than three years, used the same language in a LinkedIn post and an internal email to Walgreens employees seen by Fortune.

“This is perhaps one of the most difficult notes I have ever written over the course of my career,” Brewer wrote in both notes. Spokespeople for her and for Walgreens declined to comment further to Fortune on Friday."

"Brewer’s departure means that the most powerful Black woman running a Fortune 500 company—and one of only two Black female CEOs in the Fortune 500 at the start of last week—is out of a job, at least temporarily. (She will advise Walgreens on its search for a permanent CEO, the company said; Walgreens is paying her $9 million in severance, plus $2.25 million in consulting fees for the next six months, according to a securities filing Friday.)

"Her departure also raises questions about Walgreens’s ability to pull off the ambitious pivot towards health care that Brewer had announced six months after becoming Walgreens CEO. Like larger rival CVS, Walgreens under Brewer has been buying up primary-care clinics and trying to turn itself into a full-service health care provider. But a transformation of that magnitude takes time, and it appears to be going more slowly than both Walgreens and its investors would like: In June, the company cut its full-year earnings guidance, while executives acknowledged that they were “disappointed with the pace of our path to profitability” in its health care business.

It's also unclear how much support Brewer’s health care strategy had from Walgreens executive chairman (and former CEO and largest shareholder) Stefano Pessina. The Wall Street Journal in January reported that Pessina envisioned a slower expansion into health care, one that was “best achieved through partnerships and minority stakes," and that he said that "buying up companies outside of the core pharmacy industry unnecessarily exposed Walgreens to risk.” Spokespeople for Walgreens and Brewer did not respond to requests for comment over the weekend."

[bar1080]

They stopped being admired when the linked up with Liz Holmes and Theranos, a clue that WBA was getting desperate.

[Prudent Capitalist]

CEO Roz Brewer out ("stepped down") effective immediately. Train wreck here with WBA right now. Everything changed the day WAG closed the merger with Stefano Pessina and the European Boots Alliance. Walgreens (WAG) was one of the most admired and successful companies in America and the merger was a mistake.

[Prudent Capitalist]

Only positive here right now is WBA's 6.54% dividend. WBA did sell a chunk of Amerisource Bergen shares for $1.85 Billion.

[biotech_researcher]

Destroyed…..

[bar1080]

Like I said back in May.

"I sure don't see a buy argument with WBA. I'd never buy a stock just for an above-market dividend.

[leftovers]

Timber.... How low will it go?? WBA can't seem to get out of it's own way thses gast few quarters.

[Prudent Capitalist]

The earnings release should be interesting tomorrow am. Consensus estimate is for net profit of $1.07 per share.