Walgreens Boots Alliance Inc (WBA)

[Prudent Capitalist]

Interesting analysis which ends with a strong recommendation to buy WBA shares at these levels for serious gains going forward over the next 2-3 years.

[bschless]

Walgreens Boots Alliance “Rx Needed”


https://afterfurtherreviewonline.wordpress.com/2020/05/14/walgreens-boots-alliance-inc-wba-38-85-rx-needed/

[fung_derf]

I agree that both charts are ugly. Tough pick, but for the long haul, I like the looks of CVS better as I think they've done a much better job with ship to home stuff.
Crazily enough, RAD has the best chart of the 3 and I absolutely HATE the management there.

[Prudent Capitalist]

I don't understand it all but that is within the time frame that Brexit was viewed by analysts as a negative issue for WBA. I will continue to hold and reinvest the now 4.5% dividends in new shares to accumulate more down here. I am still up nicely on shares held for the long term but agree it has been disappointing of late. But things haven't exactly been all rosy for CVS over the past few years either.

[fung_derf]

Stock has been tanking badly since 12/18. Can't blame Covid for that.

[Prudent Capitalist]

Not sure anyone screwed anything up. The Boots merger brought in some great things and assets, but also brought with it the exposure to Europe. A lot of the decrease in WBA's share price over the past 12-18 months was attributed to Brexit and how that would impact the Boots side of the business given its heavy presence in the UK. Then COVID came along and Europe essentially shut down everywhere. WBA has remained strong in the US and the clear leader here, although it would have been more beneficial if the Fed's had not put the Kibosh on the outright acquisition of all of RAD.

[fung_derf]

This stock makes me sad. How does one screw up so badly being the leader in their industry?

[Prudent Capitalist]

Saw that this am. Might allow WBA to streamline things and focus on the end retail. Late last year Mr. Pessina was exploring taking WBA private or a sale of the entire company. Perhaps this could be connected to those issues. Time will tell.

[fung_derf]

AmerisourceBergen Corp (ABC) & Walgreens Boots Alliance Inc (WBA)
The U.S. drug distributor has approached Walgreens to explore a deal for its pharmaceutical wholesaling division, people familiar with the matter said on Monday. Walgreens owns about 27% of AmerisourceBergen and is its biggest customer. AmerisourceBergen is willing to pay about $6 billion for the Walgreens pharmaceutical wholesale business, which operates mainly under the Alliance Healthcare brand, one of the sources said. There is no certainty that the two companies will negotiate a deal, the sources added, asking not to be identified because the matter is confidential.

[Prudent Capitalist]

WBA holding up well here under the circumstances.

[badgerkid]

Hello Walgreens investors.

I'm new to this message board and I'm hoping to find some fellow investors in WBA who can share their insights on this company.

I recently purchased a new position in Walgreens (it's been years since I've owned a position) and I'm confident in the company's ability to remain solid and profitable. As for the future share price and dividends, I expect some good returns over the long haul despite the frustration of this recent price action.

There's a lot going on out there right now and getting back into the market like I am at this time has been both exciting and painful to say the least.

I'll continue to nibble at companies that warrant consideration, but I'm certain I'll regret every decision that I make in the short term - regardless, it's all about the long term when it comes to companies like Walgreens.

Good luck to all of you out there and stay healthy if at all possible.

Badgerkid

[OldAIMGuy]

WBA's price at yesterday's close tripped a buy alarm for adding 12% more shares to my holding. I put in a GTC Limit order and will see what happens at the Open today.

OAG

[Prudent Capitalist]

Has been all quiet of late as to the reports and information on WBA exploring going private via a private equity buyout. It has been clear all along that KKR did not have the financial strength to get it done alone. Will be interesting to see what develops.

[Prudent Capitalist]

I see reports that Warren Buffett and BRK are watching the Walgreens (WBA) situation but that was 2 months ago. But, it still makes sense to many, including Barrons. But let's look at it this way...….in addition to WBA's incredible cash flow and earnings, WBA has been returning Billions to shareholders each year in the form of Dividends and Stock buybacks. If BRK were to acquire WBA in its entirety (and it has the Cash to do so) and made it a wholly owned operating company within BRK, those Billions currently going to divis and stock buybacks drop straight into BRK's treasury and defray the cost of the acquisition over time. Food for thought.

[Prudent Capitalist]

WBA still trading well above my cost basis and I am continuing to reinvest all dividends as that is a free service where I hold the WBA shares in a retirement account. I figure when the share price dips I am picking up more new shares at a lower level. And, with reports that WBA is seeking to go private in a LBO or other buyout, and with the minimum projected share price of any deal being in the $76 - $78 range, I will continue to hold WBA shares and build the position through reinvestment of all dividends.

[bar1080]

I've owned WBA since 2008 so my basis is still under the current market price. Its Q. dividend has impressively increased from 11 cents to 0.46 during that period.

My portfolio of 18 individual stocks has probably outperformed that of 99% of IHUBbers mainly because I only buy blue chips (no pennies certainly) and because I virtually never trade my stocks. My *general* rule is to only sell to take take a tax loss and I haven't had one in many years.

Other IHUBers read silly charts and pay attention to even sillier hunches and stock tips, while chasing fads. I read respected investing texts and academic studies.

Looks like WBA's time as a Dividend Aristocrat may be nearing an end. For years I've complained about the poor service in Walgreen's. They put stores on every street corner (probably overpaying for the land) in their war with CVS. Their Theranos debacle should have been a sign they were running out of growth options.

I'll probably continue holding but mainly because WBA has sunk to levels where it's becoming insignificant to my soaring portfolio. One of my core stock beliefs is that trading is hugely detrimental to portfolio performance. Just about every study confirms that, if it seems no one else on IHUB knows that fact. "The more you trade, the more you lose." But that rule isn't without limits...

If, down the road, there's some tax benefit to be had and something good comes along, I'll dump WBA.

[Prudent Capitalist]

I examined the entire earnings report again and it just doesn't seem as negative as some of the headlines out of some of the reporting services. Prescription sales were up in the US but not as high as Wall Street projections wanted. One problem I see is that WBA may be taking the cost cutting they are bragging about too far. The service in our local pharmacy is getting very bad due to what appears to be understaffing as a result of staffing cuts to cut costs. It should not be backed up like it is in both the drive through lanes and the prescription counters inside for people who have a filled prescription they just need to pick up. I have been asked by 2 pharmacy managers to take the issue up the ladder with Walgreens corporate, as they need to know how pharmacy customer service is suffering with all of the cutbacks in staff.

[OldAIMGuy]

Hi PC, Re: WBA Sell-off...............

Wall Street's motto is, "Anything worth doing is worth over-doing!"

There was some heavy selling near the end of the day but short of the
initial sell-off. I'm watching volume and Accumulation/Distribution
personally to see if there are any clues. Maybe it will be in a new range
bound territory about $4 to $5 less than previous levels.

On a personal note, we've used WBA for years but our insurance for
prescriptions changed this January and we'll now be buying at the other
"wall", Walmart. So, you can all blame me!

OAG

[Stock_Barber]

Wasn't there cessation of cigarette sales a huge part of the YOY decline?

[Prudent Capitalist]

Not one post here today on the disappointing earnings report. I did not think it was that negative when I read the entire release. The headlines from services claimed that prescription revenues were down but they looked like an increase in total revenue to me.

[I-Man]

bar1080, today you really cannot trust anything regardless what is put out or filed... Nothing is reliable or constant as it once was and adds great uncertainty everywhere... A gamble in other words...

[bar1080]

I miss the old days when the Dow was loaded with Good Ole "Made in America" stocks like American Tobacco, Liggett and Lorillard. Retailers Woolworth and Sears were Dow. And yes, WBA

And car makers Nash, Studebaker and Hudson.

[I-Man]

Hard to see this as a DOW stock today... I remember when the DOW 30 was all about manufacturing, industry, real big infrastructure companies, etc.. Today it is all tech heavy and other useless stocks and can no longer be a good gauge of the true American economy...

[whytestocks]

News: $WBA This Is 1 Way Smaller Retailers Can Compete With Behemoths Like Walmart

It would be a slight overstatement to call them strange bedfellows. After all, Kroger (NYSE: KR) and Walgreens Boots Alliance (NASDAQ: WBA) -- you know it better as just Walgreens -- both sell consumer goods. The two retailers have forged a somewhat unexpected partnership all the same, a...

In case you are interested WBA - This Is 1 Way Smaller Retailers Can Compete With Behemoths Like Walmart

[whytestocks]

News: $WBA Better Buy: Walgreens Boots Alliance vs. Walmart

Two big retailers. Two different directions. That's the story for Walgreens Boots Alliance (NASDAQ: WBA) and Walmart (NYSE: WMT) in 2019. Walgreens stock has slumped by 14% while Walmart's shares have soared nearly 30% year to date. But the tide can quickly turn with investing in ...

Find out more WBA - Better Buy: Walgreens Boots Alliance vs. Walmart

[Prudent Capitalist]

Now that Buffett and BRK were outbid by Apollo for Tech Data, perhaps they may focus on a potential buyout of WBA, or at least participation in any deal that KKR puts together. As noted by many Buffett and BRK have around $128 Billion in cash they would like to deploy in a major acquisition, and they could swallow WBA whole given the projected size of any successful buyout and still have at least $40-$50 Billion left.

[tw0122]

KKR Private equity buyout firms have set up a business model that allows many of them to buy companies, load those firms up with debt, and then pay themselves massive and often secret fees with that borrowed money. If the companies go bankrupt, investors like public funds might not get paid. Worse yet, these predatory practices harm the economy and make it harder for the governments we represent to stay solvent over the long term.

Apparently some private equity companies don't mind looting a community to make a quick buck and then walking away to search for the next opportunity somewhere else. But we don't get to operate that way, and we have no desire to -- our job is to make sure that our communities are prosperous next year, next decade, and the decade after that.



The most pernicious fallout, though, is for workers. When private equity-owned companies go bankrupt, it's usually to lay off workers and get out of their own obligations. Hundreds of thousands of workers have lost their employment at private equity-owned companies in the retail sector in the last few years alone. These job losses tear families and neighborhoods apart.

[tw0122]

Robbery of Walgreens shareholders as KKR is pledging all of Walgreens shareholders assets to borrow $70 billion to perform the LBO.

Once LBO is done KKR will steal shareholder money to pay itself billions in dividends to its top executives.

Congress pending legislation to stop robber barons like KKR from looting shareholders then causing massive job losses as they steal money by looting shareholder money which usually consist of large Government Pension Funds who get sacrificed in the LBO looting.


Robber Baron KKR looting all the shareholders that own Walgreens whether that be Government pension funds like police, firefighters, teachers to mom and pop investors by pledging all of Walgreens shareholder assets against the $70 billion its borrowing for the LBO (leveraged buyout).

Once it loots all of Walgreens shareholders then KKR will borrow the stolen money from Walgreen shareholders to pay itself billions in dividends.

KKR Largest Pirate PE (Private Equity) heist of the year

[whytestocks]

News: $WBA 3 Dividend Stocks That Pay You More Than Pepsi Does

PepsiCo (NASDAQ: PEP) has been a popular dividend stock for decades. This stands to reason -- it holds a portfolio of familiar brands anchored by its near-namesake soda, and its free cash flow is strong and sustainable enough to support a relatively generous payout that currently yields 2.9%...

In case you are interested WBA - 3 Dividend Stocks That Pay You More Than Pepsi Does

[bar1080]

My BRK stock has actually sagged over the past few days amid the WBA rumors. BRK brushed against a record high a few days ago.

[bar1080]

Thanks and nice to see an informative post like that on IHUB. Do you have any idea how much Walgreen's real estate is owned by them vs leased?

They occupy a lot of key corner property but much has been acquired in the past decade no doubt at high cost.

[Prudent Capitalist]

Most analysts are modeling a LBO of WBA in the $75 - $80 range and correctly pointing out that it would have to be at least in that range to gain shareholder approval. Some really interesting analysis out of Barrons, as detailed be Dow Jones News Wire a couple of days ago:

Walgreens has been one of the most reliable businesses in the U.S. for the past 50 years," Smead says. "It's a massive generator of cash flow that pays out a meaningful dividend and buys back a lot of stock." The company has a nearly 3% dividend and bought back about 7% of its shares in its fiscal year ended in August.

The stock, though, has been out of favor this year amid investor concerns about a flattening in earnings, investment spending, and a potential disruption of the traditional pharmacy business by Amazon.com (AMZN). While higher lately on the buyout speculation, Walgreen shares are well below their 52-week high of $86 set last December.

Barron's wrote Monday that an LBO of Walgreens could be tough to pull off, given the size of deal -- which would be the largest LBO ever -- and the need for a significant amount of equity to finance it.
…….
Barron's has argued that Walgreens would be an ideal acquisition target for Berkshire as CEO Warren Buffett searches for what he called "an elephant-sized acquisition" using Berkshire's cash hoard of $128 billion.

Berkshire, which declined to comment, could swallow Walgreens whole but also could contribute, say, $10 billion, of equity, either common or preferred stock, to a KKR-led deal. It also could buy the AmerisourceBergen stake held by Walgreens. Walgreens and KKR had no immediate comment.

Berkshire earlier this year bought $10 billion of preferred stock from Occidental Petroleum (OXY) to finance its controversial $57 billion deal to buy Anadarko Petroleum. Walgreens is the kind of enterprise that likely appeals to Buffett given its entrenched position in the pharmacy business and its low valuation in a record stock market. Buffett would have to overcome his aversion to the private-equity business to participate in a Walgreens LBO.

Even with the LBO speculation, Walgreens now trades for just 11 times projected earnings in its current fiscal year ending August 2020, making it one of the cheapest stocks in the Dow Jones Industrial Average. The market multiple is around 18.

[whytestocks]

News: $WBA What Happened in the Stock Market Today

Major benchmarks finished mixed on generally quiet day on Wall Street. The  Dow Jones Industrial Average (DJINDICES: ^DJI)  eked out a gain while the  S&P 500 (SNPINDEX: ^GSPC)  posted a modest loss. The industrial and real estate sectors rose, with home construction ...

In case you are interested WBA - What Happened in the Stock Market Today

[whytestocks]

News: $WBA Dow Jones News: Walgreens Draws KKR Interest; Boeing Targets January for 737 MAX Return

The Dow Jones Industrial Average (DJINDICES: ^DJI) managed to turn positive by Monday afternoon, up 0.08% at 1:50 p.m. EST. Big gains for Walgreens Boots Alliance (NASDAQ: WBA) and Boeing (NYSE: BA) drove the Dow higher. Walgreens took a step closer to a go-private deal, and Boeing l...

In case you are interested WBA - Dow Jones News: Walgreens Draws KKR Interest; Boeing Targets January for 737 MAX Return

[whytestocks]

News: $WBA Why Walgreens Boots Alliance Shares Are Jumping Today

Shares of Walgreens Boots Alliance (NASDAQ: WBA) were jumping 6.1% higher as of 11:00 a.m. EST on Monday. The nice gain came after Bloomberg reported that private equity firm KKR made a formal offer to take the pharmacy giant private through a leveraged buyout. It's important to note that t...

In case you are interested WBA - Why Walgreens Boots Alliance Shares Are Jumping Today

[chico2663]

love sticking it to shorty

[Stock_Barber]

Especially the short ones! :)

[OldAIMGuy]

WBA is holding nicely at +6% about an hour into trading. I'm sure there's a lot of reshuffling of investors' portfolios today, I'm sure.
Tom

[Prudent Capitalist]

Projected buyout level is $70 Billion according to some services, which equates with between $78 and $79 per share. Also, as noted by many commentators, KKR cannot bite this off alone, and will need help and other funders. There is only one entity which could acquire WBA outright if they wanted to, and we know who that is. It would certainly qualify for the "Elephant Gun" but at what value and price?

[bar1080]

SA: "Walgreens Boots Alliance up 8% premarket on KKR interest"

* Walgreens Boots Alliance (NASDAQ:WBA) is up 8% premarket on modest volume in apparent reaction to a report that KKR (NYSE:KKR) has approached it about a buyout.

* Shares rallied last week over reports that private-equity shops were circling.

https://seekingalpha.com/news/3517511-walgreens-boots-alliance-8-percent-premarket-kkr-interest

[bar1080]

OTOH: "A Walgreens Leveraged Buyout? Don’t Hold Your Breath."

"A growing number of skeptics are casting doubt on the financial case for taking Walgreens Boots Alliance private in a debt-financed buyout.

The drugstore chain (ticker: WBA) has reportedly hired a banker and met with private-equity firms about a leveraged buyout, which would be the biggest in history. The stock briefly gained as much as 7% after the initial reports on Tuesday.

It has erased all of those gains since then. Walgreens shares were down 2.7% in afternoon trading Wednesday, thanks to widespread skepticism about the feasibility of an LBO.

There are indeed major hurdles to the deal. The biggest of those is finding the money to finance it—that is, if Berkshire Hathaway ..."

https://www.barrons.com/articles/lbo-walgreens-boots-alliance-skeptics-doubts-costs-51573069034?

[bar1080]

"Walgreens Billionaire Spies Even Greater Riches"

"(Bloomberg Opinion) -- A $70 billion buyout of Walgreens Boots Alliance Inc. would be straight out of the Stefano Pessina playbook. While the circumstances behind the informal talks between the company and private equity firms, including KKR & Co, are unknown, as the chief executive and largest shareholder of the drugstore chain, Pessina was probably at the forefront. Any deal would be impossible without the backing of the Italian billionaire who owns 16% of the group.

Pessina has spent more than four decades building his pharmaceutical distribution and retail empire through swashbuckling deals. He has been patient, adding to the group piece by piece. But he’s also been opportunistic. With shares in Walgreens down by about 24% over the past year, he may have spotted his chance to extract the group from the public markets.

Indeed, he’s been here before. In 2006, Pessina merged his company Alliance UniChem with Boots. A year later he took the combined group private — with KKR — in a $16 billion deal, Europe’s biggest buyout at the time.

Acquiring Walgreens would dwarf Alliance Boots. It would probably need several financial sponsors and substantial debt funding. Walgreen’s leverage is already fairly high. Net debt will be about 1.8 times Ebitda at the end of the current financial year, according to Bloomberg analyst estimates..."

https://www.yahoo.com/finance/news/walgreens-billionaire-spies-even-greater-104010292.html

[jonny_red]

Stocks to Watch making the News Coverage for 11.6.2019

$WBA $PTON $CHK

https://www.transparenttraders.me/2019/11/stocks-to-watch-making-news-coverage.html



http://thefreestockalerts.com

[Prudent Capitalist]

Looks like an entity for which Pessina is a Director has accumulated a 16.2% stake. it will really chap me if an American icon like Walgreens is taken private by European interests or funds.

A 13D/A filing with the Securities and Exchange Commission on Tuesday showed that Luxembourg-based Alliance Sante Participations S.A. (ASP) controlled 144.8 million shares, or 16.2% of the shares outstanding. Walgreens Chief Executive Stefano Pessina is administrateur, or director, of ASP.

[bar1080]

Pessino is 78. You think he'd buy it all? Or Perhaps BRK which certainly has the funding? In any event, a pleasant surprise for my portfolio.

[Prudent Capitalist]

Hey, WBA does not need that $$$$. But, Stefano Pessina may have grown weary of public reporting in the US and the whims of the market. My concern is that any buyout or taking of WBA private be at a fair value as these shares are seriously undervalued here right now at this level.

[bar1080]

LOL! Where do you go when you need $55 billion quickly and discreetly? Who ya gonna call?

[bar1080]

"Exclusive: Walgreens has explored taking drug store chain private - sources"

(Reuters) - Walgreens Boots Alliance Inc (WBA.O) has been exploring whether to go private following private equity interest in the U.S drug store chain, which has a market value of more than $55 billion, according to people familiar with the matter.

In recent months, Walgreens has held preliminary discussions with some of the world’s largest private equity firms about putting together what would be the biggest ever leveraged buyout, the sources said.

Walgreens has tasked investment bank Evercore Partners Inc (EVR.N) with exploring whether a deal can be put together, the sources said, cautioning that a deal is far from certain.

Walgreens shares rose 8% to $64.12 in New York after Reuters was first to report the news on Tuesday. It later gave back some of those gains and was up about 4%. The stock had lost 28% of its value in the last 12 months, compared to a 13% rise in the S&P 500 Index."

[Prudent Capitalist]

Yikes! Trading halted and resumed:

Walgreens Boots Alliance shares are trading higher after it was reported the company has been exploring a deal with buyout firms to go private.
Nov 5, 2019 2:22p ET Benzinga Stock Analysis

You don'tsuppose...….

[Prudent Capitalist]

IMO, we may not get full long term value if that were to occur. If they were to take it private at somewhere north of the $80 range I would feel OK, but not below there.

But, if Warren Buffett were to acquire WBA and fold it into Berkshire Hathaway (BRK.A/BRK.B), that would be very interesting and many could still have a stake.