Jefferies Reiterates Buy on Walgreens Boots Alliance (WBA) Following 4Q and Guidance
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Jefferies reiterated a Buy rating and $95.00 price target on Walgreens Boosts Alliance (NASDAQ: WBA) following the company's 4Q. Management expectations for a notable uptick in Rx volumes in F2H17 highlights the benefits of recent contract wins with leading PBMs and resulting market share gains. Investors were concerned about the company's ability to guide close to the $5.00 EPS consensus and achieve previously set LT targets for double-digit EPS growth. Considering a $0.13 drag from FX, Jefferies views WBA's $4.85-$5.20 guidance as impressive.
Analyst Brian Tanquilut commented, "WBA's Q4 results and FY17 guidance, in our view, reinforced our positive thesis on the name -- the company is gaining market share through recent contract wins, mgmt. is progressing with efforts to reduce G&A, drive EBIT growth, and boost FCF, all of which are positive as they should enable WBA to deliver doubledigit EPS growth, even with FX headwinds. The extension of the RAD merger agreement is a positive kicker that could lead to incremental stock upside."
Shares of Walgreens Boosts Alliance closed at $81.02 yesterday.
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