Walgreens Stock Story

WBA

Stock

USD 39.90 0.77 1.97%

Macroaxis Story

Walgreens Boots Alliance is scheduled to announce its earnings today. The next financial report is expected on the 7th of July 2022. Walgreens Boots Net Income Per Employee is projected to decrease significantly based on the last few years of reporting. The past year's Net Income Per Employee was at 9,280. The current year Average Assets is expected to grow to about 66.8 B, whereas Revenue Per Employee is forecasted to decline to about 352.5 K. While many traders are getting carried away by overanalyzing healthcare space, it is reasonable to go over Walgreens Boots Alliance as an investment alternative.

Published over a month ago

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Chances of Walgreens (NASDAQ:WBA) to slip in July

The company has 38.56 B in debt with debt to equity (D/E) ratio of 1.22, which is OK given its current industry classification. Walgreens Boots Alliance has a current ratio of 0.73, suggesting that it has not enough short term capital to pay financial commitments when the payables are due. Debt can assist Walgreens Boots until it has trouble settling it off, either with new capital or with free cash flow. So, Walgreens Boots' shareholders could walk away with nothing if the company can't fulfill its legal obligations to repay debt. However, a more frequent occurrence is when companies like Walgreens Boots Alliance sell additional shares at bargain prices, diluting existing shareholders. Debt, in this case, can be an excellent and much better tool for Walgreens to invest in growth at high rates of return. When we think about Walgreens Boots' use of debt, we should always consider it together with cash and equity.

Walgreens Boots financial leverage ratio helps determine the effect of debt on the overall profitability of the company. It measures the total debt position of Walgreens Boots, including all of Walgreens Boots's outstanding debt obligations, and compares it with the equity. In simple terms, the high financial leverage means the cost of production, together with running the business day-to-day, is high, whereas, lower financial leverage implies lower fixed cost investment in the business and generally considered by investors to be a good sign. So if creditors own a majority of Walgreens Boots assets, the company is considered highly leveraged. Understanding the composition and structure of overall Walgreens Boots debt and outstanding corporate bonds gives a good idea of how risky the capital structure of a business is and if it is worth investing in it.

Please read more on our technical analysis page.

Understanding Walgreens Total Debt

Walgreens Boots Alliance liabilities are broken down into two parts on the balance sheet. These are short-term (or current) obligations and long-term debt. Walgreens Boots Alliance has to fulfill its short-term liabilities in this reporting year and should be no more than 12 months old. Long-term debt, on the other hand, is anything beyond the 12-month payment timeframe. Common short-term liabilities found on Walgreens Boots balance sheet include debt obligations and money owed to different Walgreens Boots vendors, workers, and loan providers. Below is the chart of Walgreens main long-term debt accounts currently reported on its balance sheet.

You can use Walgreens Boots Alliance financial leverage analysis tool to get a better grip on understanding its financial position

How important is Walgreens Boots's Liquidity

Walgreens Boots financial leverage refers to using borrowed capital as a funding source to finance Walgreens Boots Alliance ongoing operations. It is usually used to expand the firm's asset base and generate returns on borrowed capital. Walgreens Boots financial leverage is typically calculated by taking the company's all interest-bearing debt and dividing it by total capital. So the higher the debt-to-capital ratio (i.e., financial leverage), the riskier the company. Please check the breakdown between Walgreens Boots's total debt and its cash.

What do experts say?

Stock analysis is a method for investors and traders to make buying and selling decisions. By studying and evaluating past and current data, investors and traders attempt to gain an edge in the markets by making informed decisions.

It is good to see analyst projects for Walgreens Boots, but it might be worth checking our own buy vs. sell analysis

Acquisition by Dominic Murphy of 671 shares of Walgreens Boots subject to Rule 16b-3

Legal trades by Walgreens Boots insiders are very common, as founders, directors, or employees of any publicly traded firm often have stock or stock options. These trades are made public in the United States through the filing of Form 4 of the Securities and Exchange Commission. Below entry was recorded recently and is publicly available as an insider trade:

Walgreens insider trading alert for grant of phantom stock units by Dominic Murphy, the corporate stakeholder, on 15th of July 2022. This event was filed by Walgreens Boots Alliance with SEC on 2022-07-15. Statement of changes in beneficial ownership - SEC Form 4 [view details]

Note, although insider trading is legal, in the United States, Canada, Australia, and Germany, for mandatory reporting purposes, corporate insiders are defined as a company's officers, directors, and any beneficial owners of more than 10% of a class of the company's equity securities.

Breaking down Walgreens Boots Further

The small slip in market price for the last few months may raise some interest from investors as it is trading at a share price of 42.19 on 7,140,120 in trading volume. The company executives did not add much value to Walgreens Boots Alliance investors in May. However, diversifying your holdings with Walgreens Boots Alliance or similar stocks can still protect your portfolio during high-volatility market scenarios. The stock standard deviation of daily returns for 90 days investing horizon is currently 1.89. The below-average Stock volatility is a good sign for longer-term investment options and for buy-and-hold investors.

Liabilities Breakdown

Tax Liabilities

18.7 B

Current Liabilities

24.7 B

Long-Term Liabilities

	Total Liabilities	45.43 Billion
	Current Liabilities	18.69 Billion
	Long-Term Liabilities	24.66 Billion
	Tax Liabilities	2.77 Billion

Are Walgreens Boots technical ratios showing a recoup?

Current risk adjusted performance indicator falls down to -0.13. Possible price jump? Walgreens Boots Alliance exhibits very low volatility with skewness of -1.53 and kurtosis of 4.35. However, we advise investors to further study Walgreens Boots Alliance technical indicators to make sure all market info is available and is reliable. Understanding different market volatility trends often help investors to time the market. Properly using volatility indicators enable traders to measure Walgreens Boots' stock risk against market volatility during both bullying and bearish trends. The higher level of volatility that comes with bear markets can directly impact Walgreens Boots' stock price while adding stress to investors as they watch their shares' value plummet. This usually forces investors to rebalance their portfolios by buying different stocks as prices fall.

Walgreens Boots Implied Volatility

Walgreens Boots' implied volatility exposes the market's sentiment of Walgreens Boots Alliance stock's possible movements over time. However, it does not forecast the overall direction of its price. In a nutshell, if Walgreens Boots' implied volatility is high, the market thinks the stock has potential for high price swings in either direction. On the other hand, the low implied volatility suggests that Walgreens Boots stock will not fluctuate a lot when Walgreens Boots' options are near their expiration.

The Bottom Line

Whereas other companies in the pharmaceutical retailers industry are either recovering or due for a correction, Walgreens may not be as strong as the others in terms of longer-term growth potentials. In closing, as of the 30th of June 2022, our present 90 days buy vs. sell advice on the company is Strong Hold. We believe Walgreens Boots is currently undervalued with below average odds of financial turmoil for the next two years.

Editorial Staff

Raphi Shpitalnik is a Junior Member of Macroaxis Editorial Board. Raphael is a young entrepreneur who joined Macroaxis on a part-time base at the beginning of the pandemic and eventually acquired a real test for investing and fintech. He likes to analyze different equity instruments across a wide range of industries, focusing primarily on consumer products, sports, fintech, cannabis, and AI. View Profile

This story should be regarded as informational only and should not be considered a solicitation to sell or buy any financial products. Macroaxis does not express any opinion as to the present or future value of any investments referred to in this post. This post may not be reproduced without the consent of Macroaxis LLC. Macroaxis LLC and Raphi Shpitalnik do not own shares of Walgreens Boots Alliance. Please refer to our Terms of Use for any information regarding our disclosure principles.

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