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

In the latest trading session, Walgreens Boots Alliance (WBA) closed at $48.46, marking a +0.94% move from the previous day.

This story originally appeared on Zacks

In the latest trading session, Walgreens Boots Alliance (WBA) closed at $48.46, marking a +0.94% move from the previous day. The stock lagged the S&P 500's daily gain of 1.21%.

- Zacks

Heading into today, shares of the largest U.S. drugstore chain had lost 1.32% over the past month, lagging the Retail-Wholesale sector's gain of 1.61% and the S&P 500's loss of 0.9% in that time.

Investors will be hoping for strength from WBA as it approaches its next earnings release, which is expected to be October 14, 2021. The company is expected to report EPS of $1.01, down 0.98% from the prior-year quarter. Meanwhile, our latest consensus estimate is calling for revenue of $33.28 billion, down 4.23% from the prior-year quarter.

Investors might also notice recent changes to analyst estimates for WBA. These revisions typically reflect the latest short-term business trends, which can change frequently. As such, positive estimate revisions reflect analyst optimism about the company's business and profitability.

Based on our research, we believe these estimate revisions are directly related to near-team stock moves. 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.

Ranging from #1 (Strong Buy) to #5 (Strong Sell), the Zacks Rank system has a proven, outside-audited track record of outperformance, with #1 stocks returning an average of +25% annually since 1988. The Zacks Consensus EPS estimate has moved 1.16% lower within the past month. WBA is currently a Zacks Rank #3 (Hold).

Digging into valuation, WBA currently has a Forward P/E ratio of 9.44. For comparison, its industry has an average Forward P/E of 9.44, which means WBA is trading at a no noticeable deviation to the group.

Also, we should mention that WBA has a PEG ratio of 1.38. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. Retail - Pharmacies and Drug Stores stocks are, on average, holding a PEG ratio of 1.53 based on yesterday's closing prices.

The Retail - Pharmacies and Drug Stores industry is part of the Retail-Wholesale sector. This industry currently has a Zacks Industry Rank of 128, which puts it in the top 50% of all 250+ industries.

The Zacks Industry Rank includes is listed in order from best to worst in terms of the average Zacks Rank of the individual companies within each of these sectors. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

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