NasdaqGS:WBA

Stock Analysis Report

Executive Summary

Walgreens Boots Alliance, Inc. operates as a pharmacy-led health and wellbeing company.


Snowflake Analysis

Undervalued established dividend payer.


Similar Companies

Share Price & News

How has Walgreens Boots Alliance's share price performed over time and what events caused price changes?


Latest Share Price and Events

Stable Share Price: WBA has not had significant price volatility in the past 3 months.


Market Performance


7 Day Return

-2.6%

WBA

0.6%

US Consumer Retailing

-1.1%

US Market


1 Year Return

-26.9%

WBA

17.5%

US Consumer Retailing

17.9%

US Market

Return vs Industry: WBA underperformed the US Consumer Retailing industry which returned 17.5% over the past year.

Return vs Market: WBA underperformed the US Market which returned 17.9% over the past year.


Shareholder returns

WBAIndustryMarket
7 Day-2.6%0.6%-1.1%
30 Day-1.1%2.5%1.4%
90 Day-15.2%0.4%6.9%
1 Year-24.5%-26.9%19.8%17.5%20.3%17.9%
3 Year-36.5%-41.3%47.5%37.9%47.8%38.3%
5 Year-30.6%-38.1%48.4%33.0%71.9%53.0%

Price Volatility Vs. Market

How volatile is Walgreens Boots Alliance's share price compared to the market and industry in the last 5 years?


Simply Wall St News

Valuation

Is Walgreens Boots Alliance undervalued compared to its fair value and its price relative to the market?

>50%

Undervalued compared to fair value


Share Price vs. Fair Value

Below Fair Value: WBA ($51.45) is trading below our estimate of fair value ($109.43)

Significantly Below Fair Value: WBA is trading below fair value by more than 20%.


Price To Earnings Ratio

PE vs Industry: WBA is good value based on its PE Ratio (12.6x) compared to the Consumer Retailing industry average (22.1x).

PE vs Market: WBA is good value based on its PE Ratio (12.6x) compared to the US market (18.2x).


Price to Earnings Growth Ratio

PEG Ratio: WBA's earnings are forecast to decline next year, so we can't calculate its PEG ratio.


Price to Book Ratio

PB vs Industry: WBA is good value based on its PB Ratio (1.9x) compared to the US Consumer Retailing industry average (2.1x).


Next Steps

Future Growth

How is Walgreens Boots Alliance forecast to perform in the next 1 to 3 years based on estimates from 20 analysts?

-1.4%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: WBA's earnings are forecast to decline over the next 3 years (-1.4% per year).

Earnings vs Market: WBA's earnings are forecast to decline over the next 3 years (-1.4% per year).

High Growth Earnings: WBA's earnings are forecast to decline over the next 3 years.

Revenue vs Market: WBA's revenue (3.1% per year) is forecast to grow slower than the US market (7.6% per year).

High Growth Revenue: WBA's revenue (3.1% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: WBA's Return on Equity is forecast to be low in 3 years time (15.3%).


Next Steps

Past Performance

How has Walgreens Boots Alliance performed over the past 5 years?

6.6%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: WBA has high quality earnings.

Growing Profit Margin: WBA's current net profit margins (2.7%) are lower than last year (4%).


Past Earnings Growth Analysis

Earnings Trend: WBA's earnings have grown by 6.6% per year over the past 5 years.

Accelerating Growth: WBA's has had negative earnings growth over the past year, so it can't be compared to its 5-year average.

Earnings vs Industry: WBA had negative earnings growth (-30.5%) over the past year, making it difficult to compare to the Consumer Retailing industry average (-6%).


Return on Equity

High ROE: WBA's Return on Equity (15.2%) is considered low.


Return on Assets


Return on Capital Employed


Next Steps

Financial Health

How is Walgreens Boots Alliance's financial position?


Financial Position Analysis

Short Term Liabilities: WBA's short term assets ($19.6B) do not cover its short term liabilities ($29.5B).

Long Term Liabilities: WBA's short term assets ($19.6B) do not cover its long term liabilities ($37.0B).


Debt to Equity History and Analysis

Debt Level: WBA's debt to equity ratio (69.3%) is considered high.

Reducing Debt: WBA's debt to equity ratio has reduced from 69.7% to 69.3% over the past 5 years.

Debt Coverage: WBA's debt is well covered by operating cash flow (36.7%).

Interest Coverage: WBA's interest payments on its debt are well covered by EBIT (6.8x coverage).


Balance Sheet

Inventory Level: WBA has a high level of physical assets or inventory.

Debt Coverage by Assets: WBA's debt is covered by short term assets (assets are 1.2x debt).


Next Steps

Dividend

What is Walgreens Boots Alliance's current dividend yield, its reliability and sustainability?

3.56%

Current Dividend Yield


Dividend Yield vs Market

company3.6%marketbottom25%1.4%markettop25%3.7%industryaverage1.8%forecastin3Years3.7%

Current dividend yield vs market & industry

Notable Dividend: WBA's dividend (3.56%) is higher than the bottom 25% of dividend payers in the US market (1.45%).

High Dividend: WBA's dividend (3.56%) is low compared to the top 25% of dividend payers in the US market (3.73%).


Stability and Growth of Payments

Stable Dividend: WBA's dividends per share have been stable in the past 10 years.

Growing Dividend: WBA's dividend payments have increased over the past 10 years.


Current Payout to Shareholders

Dividend Coverage: With its reasonably low payout ratio (44%), WBA's dividend payments are well covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: WBA's dividends in 3 years are forecast to be well covered by earnings (33.2% payout ratio).


Next Steps

Management

How experienced are the management team and are they aligned to shareholders interests?

2.7yrs

Average management tenure


CEO

Stefano Pessina (78yo)

4.6yrs

Tenure

US$19,156,202

Compensation

Mr. Stefano Pessina has been an Executive Vice Chairman of Walgreens Boots Alliance, Inc. since January 2015 and has been its Chief Executive Officer since July 9, 2015. Mr. Pessina previously served as Ac ...


CEO Compensation Analysis

Compensation vs Market: Stefano's total compensation ($USD19.16M) is above average for companies of similar size in the US market ($USD10.81M).

Compensation vs Earnings: Stefano's compensation has increased by more than 20% whilst company earnings have fallen more than 20% in the past year.


Leadership Team

NamePositionTenureCompensationOwnership
James Skinner
Executive Chairman of the Board5.1yrsUS$9.40m0.017% $7.6m
Stefano Pessina
Executive Vice Chairman & CEO4.6yrsUS$19.16m0.021% $9.4m
James Kehoe
Executive VP & Global CFO1.7yrsUS$6.68m0.013% $5.9m
Alexander Gourlay
Co-Chief Operating Officer3.7yrsUS$8.23m0.086% $39.2m
Ornella Barra
Co-Chief Operating Officer3.7yrsUS$7.13m0.20% $91.1m
Heather Dixon
Senior VP0.9yrsno data0.00055% $250.7k
Francesco Tinto
Global Chief Information Officer & Senior VP0.4yrsno datano data
Marco Patrick Pagni
Executive VP4yrsno data0.00059% $268.9k
Gerald Gradwell
Senior Vice President of Investor Relations0yrsno datano data
Aaron Radelet
Global Chief Communications Officer & Senior VP0.08yrsno datano data

2.7yrs

Average Tenure

59yo

Average Age

Experienced Management: WBA's management team is considered experienced (2.7 years average tenure).


Board Members

NamePositionTenureCompensationOwnership
James Skinner
Executive Chairman of the Board5.1yrsUS$9.40m0.017% $7.6m
Stefano Pessina
Executive Vice Chairman & CEO4.6yrsUS$19.16m0.021% $9.4m
Dominic Murphy
Independent Director7.5yrsUS$300.00k0.000090% $41.0k
William Foote
Lead Independent Director5.1yrsUS$360.00k0.00093% $423.9k
Ginger Graham
Independent Director9.8yrsUS$300.00k0.00024% $109.4k
David Brailer
Independent Director9.3yrsUS$320.00k0.00058% $264.4k
José Almeida
Independent Director2.8yrsUS$299.99k0.00084% $382.9k
Nancy Schlichting
Independent Director13.3yrsUS$319.99k0.0010% $474.0k
John Lederer
Independent Director4.8yrsUS$300.00k0.0056% $2.6m
Janice Babiak
Independent Director7.8yrsUS$325.00k0.00014% $63.8k

6.3yrs

Average Tenure

63yo

Average Age

Experienced Board: WBA's board of directors are considered experienced (6.3 years average tenure).


Ownership

Who are the major shareholders and have insiders been buying or selling?


Insider Trading Volume

Insider Buying: Insufficient data to determine if insiders have bought more shares than they have sold in the past 3 months.


Recent Insider Transactions

Ownership Breakdown

Dilution of Shares: Shareholders have not been meaningfully diluted in the past year.


Top Shareholders

Company Information

Walgreens Boots Alliance, Inc.'s company bio, employee growth, exchange listings and data sources


Key Information

  • Name: Walgreens Boots Alliance, Inc.
  • Ticker: WBA
  • Exchange: NasdaqGS
  • Founded: 1901
  • Industry: Drug Retail
  • Sector: Consumer Retailing
  • Market Cap: US$45.578b
  • Shares outstanding: 885.86m
  • Website: https://www.walgreensbootsalliance.com

Number of Employees


Location

  • Walgreens Boots Alliance, Inc.
  • 108 Wilmot Road
  • Deerfield
  • Illinois
  • 60015
  • United States

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
WBANasdaqGS (Nasdaq Global Select)YesCommon StockUSUSDJan 1968
W8ADB (Deutsche Boerse AG)YesCommon StockDEEURJan 1968
WBA *BMV (Bolsa Mexicana de Valores)YesCommon StockMXMXNJan 1968
WGNXTRA (XETRA Trading Platform)YesCommon StockDEEURJan 1968
WBASWX (SIX Swiss Exchange)YesCommon StockCHCHFJan 1968
0LSZLSE (London Stock Exchange)YesCommon StockGBUSDJan 1968
WBAWBAG (Wiener Boerse AG)YesCommon StockATEURJan 1968
W8AETLX (Eurotlx)YesCommon StockITEURJan 1968
WGBA34BOVESPA (Bolsa de Valores de Sao Paulo)BDR EACH 1 REP 0.5 COM USD0.01BRBRLMay 2019

Biography

Walgreens Boots Alliance, Inc. operates as a pharmacy-led health and wellbeing company. It operates through three segments: Retail Pharmacy USA, Retail Pharmacy International, and Pharmaceutical Wholesale. The Retail Pharmacy USA segment sells prescription drugs and an assortment of retail products, including health, wellness, beauty, personal care, consumable, and general merchandise products through its retail drugstores and convenient care clinics. It also provides specialty pharmacy services and mail services; and manages in-store clinics. As of August 31, 2019, this segment operated 9,277 retail stores under the Walgreens and Duane Reade brands in the United States; and 6 specialty pharmacies. The Retail Pharmacy International segment sells prescription drugs; and health and wellness, beauty, personal care, and other consumer products through its pharmacy-led health and beauty stores and optical practices, as well as through boots.com and an integrated mobile application. This segment operated 4,605 retail stores under the Boots, Benavides, and Ahumada in the United Kingdom, Thailand, Norway, the Republic of Ireland, the Netherlands, Mexico, and Chile; and 606 optical practices, including 165 on a franchise basis. The Pharmaceutical Wholesale segment engages in the wholesale and distribution of specialty and generic pharmaceuticals, health and beauty products, and home healthcare supplies and equipment, as well as provides related services to pharmacies and other healthcare providers. This segment operates in the United Kingdom, Germany, France, Turkey, Spain, the Netherlands, Egypt, Norway, Romania, the Czech Republic, and Lithuania. Walgreens Boots Alliance, Inc. was founded in 1901 and is based in Deerfield, Illinois. 


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2020/02/23 00:13
End of Day Share Price2020/02/21 00:00
Earnings2019/11/30
Annual Earnings2019/08/31


Unless specified all financial data is based on a yearly period but updated quarterly. This is known as Trailing Twelve Month (TTM) or Last Twelve Month (LTM) Data. Learn more here.