WBA
WBA is starting to look interesting sub $16. With it's guidance of $3.20-3.35, it is trading slightly sub 5 PE. Now it should get a low multiple of 7-8 in my opinion until it proves more sustained growth, but sub 5 seems a bit low. So it is cheap.
Now here are the questions.
1) Do you think they are gonna hit guidance? If you believe that, plus any earnings growth next FY, than the stock is a pretty good buy here. Now the question is whether they are being conservative with the guide after last quarter's beat, or are things getting worse. Based on what they said in the last PR I would say things are a little more challanging right now.
2) Is CVS a bad sign? Lets face it a couple of weeks back CVS had a real stinker of a report, with lousy guidance. is this a harbringer of bad things to come with WBA, who knows?
3) WBA recently paid a Divy? Is the Divy safe, right now they can easily pay it, I would say the divy is safe, but who knows they may want to be more aggressive doing other things with the cash flows for all I know. I would think or at least hope the divy is here to stay though.
4) Technical Weakness? The stock has clearly broken down and is essentially at absurd lows that haven't been seen in decades essentially. Thing is even with this drop we are looking for support, and it tough to tell where that will be on a chart. And the RSI is stil 32, although getting closer to oversold, it is not oversold yet either.
Conclusion: I think WBA a case can easily be made that it is a good value, but a case could be made it is a trap. Would like te RSI to drop under 30 at the very least to have oversold conditions present at the point. The divy I think is safe, but the question is will they hit guidance and can they grow earnings from here, I think it is much more likely they hit guidance, my concern is I'm not sure they will grow next FY either (Analysts right now have EPS down the year after, which is cleary not a plus), which means if earnings are flat to down, and bad comps what is the catalyst to move the stock higher. If things go well it has 30-50% upside plus the divy over the next year. I see a scenario where buying it here can be a solid trade. I also think alot of stuff has waaaaaaaaaaaaaaaaaay better fundies, and I'm not even sure over the coming quarters are fundies getting worse or better. To be honest I'm considering it, but I'm not sold on it either. So basically to answer your question the word would be Mild interest a the moment, but I think the RSI would need to be south of 30 for me to get more serious, and we aren't there yet eventhough the stock is somewhat close. All is just my opinion, and I could always be wrong though.
