As a single entity, the stock market did fairly well today. But Walgreens Boots Alliance (WBA 3.19%) did exceptionally well, with its share price closing more than 3% higher on the day compared to the S&P 500 index’s 0.1% rise. That isn’t surprising in retrospect, as the pharmacy chain operator reported encouraging quarterly results.
Sales and profitability increases, and a double beat
For its fiscal second quarter of 2024, Walgreens booked just over $37 billion in sales, which was a 6% improvement over the same period of fiscal 2023. On the bottom line, non-GAAP (adjusted) earnings edged up slightly to land at $1.04 billion, or $1.20 per share.
With those numbers, Walgreens easily topped the consensus analyst estimates. These predicted the company’s sales would total $35.9 billion, and adjusted per-share net income would amount to only $0.82.
A focus on cost savings and profitability boosting is the goal for this year, Walgreens said in its earnings release. The company aims to save $1 billion in costs this year and pledged to continue “strategically reviewing” its asset portfolio. It’s already moving on this goal, as it booked a $5.8 billion impairment charge on its investment in VillageMD, an operator of health clinics. Walgreens plans to shut more than 160 VillageMD outlets.
Full-year bottom-line guidance is adjusted
Walgreens also revised its full-year fiscal 2024 profitability guidance. Management now believes the company will net an adjusted profit of $3.20 to $3.35; it trimmed the upper end of that range from the previous $3.50. It said this was due to a “challenging retail environment,” among other factors.
Eric Volkman has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.
