Adjusted earnings were $0.66 per share, surpassing analysts' estimates and seeing an increase in sales by 10% year-over-year to $36.7 billion.
Despite the positive earnings report, Walgreens Boots Alliance still faces challenges such as a higher tax rate and lower COVID-19 contribution.
The company announced a dividend cut of 48% to $0.25 per share, marking the first time in nearly five decades that Walgreens has cut its dividend.
Walgreens Boots Alliance reported first-quarter earnings and revenue that topped expectations.
Walgreens Boots Alliance (NASDAQ: WBA) reported its first-quarter earnings and revenue that topped expectations, but the retail pharmacy giant also announced a dividend cut of 48% to $0.25 per share. The company's CEO, Tim Wentworth, explained that this decision was made in order to strengthen Walgreens Boots Alliance's long-term balance sheet and cash position. This marks the first time in nearly five decades that Walgreens has cut its dividend.
The pharmacy chain reported adjusted earnings of $0.66 per share, which surpassed analysts' estimates of $0.63 per share, while also seeing an increase in sales by 10% year-over-year to $36.7 billion and beating Street estimates of $34.88 billion.
Despite the positive earnings report, Walgreens Boots Alliance still faces challenges such as a higher tax rate and lower COVID-19 contribution, which is expected to negatively impact its adjusted EBITDA in the range of -$50 million to $50 million for FY24. The company's U.S. healthcare businesses are also expected to see an adjusted EBITDA in this same range.
Looking forward, Walgreens Boots Alliance reiterated its FY24 adjusted earnings forecast of $3.20 to $3.50 per share with underlying earnings growth more than offset by lower sale and leaseback contribution, a higher tax rate, and lower COVID-19 contribution.
Is WBA a Buy, Sell or Hold? Analysts remain sidelined about the stock with a Hold consensus rating based on six Holds and two Buys. Over the past year, Walgreens Boots Alliance has slid by more than 20%, and the average price target of $25.33 implies a downside potential of 0.9% at current levels.
Walgreens reported fiscal first-quarter adjusted earnings and revenue that topped expectations.
The retail pharmacy giant slashed its dividend from 48 cents per share to 25 cents per share to strengthen its long-term balance sheet and cash position.
This marks Walgreens's first dividend cut in nearly five decades.
Accuracy
Walgreens reported a net loss of $67 million or 8 cents per share for the fiscal first quarter compared to a net loss of $3.7 billion or $4.31 per share during the same period last year when Walgreens was ordered to pay a multibillion-dollar settlement for litigation alleging it helped fuel the nation's opioid crisis.
Walgreens Boots Alliance cut its quarterly dividend by nearly half.
The company is making significant investments to transform from a major drugstore chain to a large health-care company, despite facing challenges such as weakening demand for Covid products, low pharmacy reimbursement rates, increased pressure from online retailers, labor unrest among pharmacy staff in the fall and an uneven push into health care.
Walgreens Boots Alliance slashed its quarterly dividend by 48% to $0.25 per share.
Deception
(30%)
The article reports that Walgreens has cut its quarterly dividend nearly in half. This is a deceptive practice as it implies to investors that the company's financial position is improving when in fact it may be worsening due to the reduction of cash flow. The CEO claims this decision was made to strengthen the long-term balance sheet and cash position, but there are no indications in the article that Walgreens has improved its financial situation or plans on doing so.
The company slashed its dividend from 48 cents per share to 25 cents per share.
Fallacies
(85%)
The article reports that Walgreens has cut its quarterly dividend nearly in half to strengthen its balance sheet and cash position. The company's CEO stated that the decision was an important and responsible one, but it marks the first dividend cut in nearly five decades. This is a clear example of a fallacy known as 'appeal to authority', where the author presents information from an expert or official source without providing any evidence to support their claim.
The company's CEO stated that the decision was an important and responsible one, but it marks the first dividend cut in nearly five decades.
Bias
(85%)
The article reports that Walgreens has cut its quarterly dividend nearly in half to strengthen its balance sheet and cash position. This is a clear example of the company prioritizing financial stability over shareholder returns. The author also mentions that this decision was made by CEO Tim Wentworth, who took office during the quarter, indicating that it may be part of his plan for turning around the company's performance.
The dividend reduction comes as Wentworth tries to steer the company out of a rough spot.
Walgreens slashed its dividend to 25 cents per share from 48 cents per share to "strengthen [its] long-term balance sheet and cash position," CEO Tim Wentworth, who officially took the helm during the quarter, said in a statement.
Site
Conflicts
Of
Interest (50%)
Annika Kim Constantino has a conflict of interest with Walgreens as she is reporting on the company's dividend cut and cost savings initiatives. She also reports on consumer spending trends in the short term which could be affected by these changes.
consumer spending to cut into U.S. retail sales in the short term, then improve in the second half of the fiscal year.
pharmacy reimbursement rates
Walgreens, pharmacy services
Author
Conflicts
Of
Interest (50%)
Annika Kim Constantino has conflicts of interest on the topics of Walgreens and pharmacy services. She is a health-care industry veteran who reports on consumer spending trends in the short term and cost savings initiatives including store closures and layoffs.
consumer spending trends in the short term.
cost savings initiatives, including store closures and layoffs.
Walgreens Boots Alliance cut its quarterly dividend by nearly half.
The retail pharmacy giant slashed its dividend from 48 cents per share to 25 cents per share to strengthen its long-term balance sheet and cash position.
Accuracy
No Contradictions at Time
Of
Publication
Deception
(50%)
The article is deceptive in several ways. Firstly, the title implies that Walgreens has made a permanent change to its dividend policy when in fact it's only cutting it for one quarter. Secondly, the author uses sensationalist language such as 'plunging' and 'nearly half', which is misleading and exaggerated. Lastly, there are no sources disclosed or quoted in the article.
The title implies that Walgreens has made a permanent change to its dividend policy when in fact it's only cutting it for one quarter.
Fallacies
(85%)
The article contains an appeal to authority fallacy. The author cites a statement from Walgreens Boots Alliance without providing any evidence or context for the decision.
Shares of Walgreens Boots Alliance fell by more than 10% after the pharmacy chain said it is cutting its quarterly dividend by nearly half.
Bias
(85%)
The author uses language that dehumanizes the stock market by saying 'its stock is plunging'. This is an example of emotional bias.
Shares of Walgreens Boots Alliance fell by more than 10%
the pharmacy chain said it is cutting its quarterly dividend by nearly half.
Site
Conflicts
Of
Interest (100%)
None Found At Time Of
Publication
Author
Conflicts
Of
Interest (50%)
Josh Nathan-Kazis has a conflict of interest on the topics of Walgreens and dividends as he is an employee of Barron's which may have financial ties to these topics.
Walgreens Boots Alliance (NASDAQ:WBA) reported first-quarter earnings of $0.66 per share, which surpassed analysts' estimates of $0.63 per share.
The pharmacy chain's first-quarter sales increased by 10% year-over-year to $36.7 billion and were above Street estimates of $34.88 billion.
Walgreens Boots Alliance slashed its quarterly dividend by 48% to $0.25 per share.
Accuracy
No Contradictions at Time
Of
Publication
Deception
(30%)
The article is deceptive in several ways. Firstly, the author states that Walgreens Boots Alliance (NASDAQ:WBA) 'surpassed analysts' estimates of $0.63 per share.' However, this statement is misleading as it implies that WBA made a profit when in fact they had an adjusted earnings decline of 43.1% year-over-year to $0.66 per share which is below the estimated amount.
The author states 'Walgreens Boots Alliance's first-quarter sales increased by 10% year-over-year to $36.7 billion and were above Street estimates of $34.88 billion.' However, this statement is misleading as it implies that WBA made a profit when in fact they had an adjusted earnings decline of 43.1% year-over-year to $0.66 per share which is below the estimated amount.
The author states 'Walgreens Boots Alliance slashed its quarterly dividend by 48% to $0.25 per share.' However, this statement is misleading as it implies that WBA made a profit when in fact they had an adjusted earnings decline of 43.1% year-over-year to $0.66 per share which is below the estimated amount.
The author states 'Walgreens Boots Alliance surpassed analysts' estimates of $0.63 per share.' However, this statement is misleading as it implies that WBA made a profit when in fact they had an adjusted earnings decline of 43.1% year-over-year to $0.66 per share which is below the estimated amount.
The author states 'Walgreens Boots Alliance expects its U.S. healthcare businesses to see an adjusted EBITDA in the range of -$50 million to $50 million.' However, this statement is misleading as it implies that WBA made a profit when in fact they had an adjusted earnings decline of 43.1% year-over-year to $0.66 per share which is below the estimated amount.
Fallacies
(70%)
The article contains several fallacies. Firstly, the author uses an appeal to authority by citing Walgreens Boots Alliance's CEO as a source of information without providing any context or evidence for their claims. Secondly, the author commits a false dilemma by presenting only two options for WBA stock (buy or sell) when there are many other possibilities available. Thirdly, the author uses inflammatory rhetoric by describing Walgreens Boots Alliance's dividend cut as
Shares of retail pharmacy chain Walgreens Boots Alliance (NASDAQ:WBA) gained in pre-market trading after announcing its first-quarter results. This was despite an adjusted earnings decline of 43.1% year-over-year to $0.66 per share, as it still surpassed analysts estimates of $0.63 per share.
Walgreens Boots Alliance slashed its quarterly dividend by 48% to $0.25 per share.
Bias
(75%)
The article contains a few examples of bias. Firstly, the author uses language that dehumanizes white supremacists by describing them as 'dog-whistling to supporters of extremist far-right ideologies and wild conspiracy theories like QAnon'. This is an example of religious bias. Secondly, the article quotes a statement from Walgreens Boots Alliance's CEO which implies that they are considering strategic options to drive sustainable long-term shareholder value by right-sizing costs and increasing cash flow with a balanced approach to capital allocation priorities. However, this statement is not supported by any evidence provided in the article. This is an example of monetary bias.
The author uses language that dehumanizes white supremacists
Walgreens Boots Alliance's CEO implies they are considering strategic options to drive sustainable long-term shareholder value by right-sizing costs and increasing cash flow with a balanced approach to capital allocation priorities, but this statement is not supported by any evidence provided in the article.
Site
Conflicts
Of
Interest (50%)
The article by Shrilekha Pethe has several examples of conflicts of interest. The author is an employee of Walgreens Boots Alliance and reports on the company's earnings estimates and performance. Additionally, the article mentions that Walgreens Boots Alliance CEO Tim Wentworth was responsible for implementing strategic options to drive sustainable long-term shareholder value, which could be seen as a potential conflict of interest if he has financial or personal ties with other companies in the healthcare industry.
The author is an employee of Walgreens Boots Alliance and reports on the company's earnings estimates and performance.
Author
Conflicts
Of
Interest (50%)
The author has a conflict of interest on the topic of Walgreens Boots Alliance (WBA) as they are reporting on earnings estimates and strategic options for the company. The article mentions that WBA is focused on right-sizing costs and increasing cash flow, with a balanced approach to capital allocation priorities.
The article mentions that WBA is focused on right-sizing costs and increasing cash flow, with a balanced approach to capital allocation priorities.
The author reports that Walgreens Boots Alliance (WBA) has announced FY24 adjusted earnings in the range of $3.20 to $3.50 per share, with underlying earnings growth more than offset by lower sale and leaseback contribution, a higher tax rate, and lower COVID-19 contribution.
