Goldman Sachs Comments on Walgreen (WAG) June Sales Data

Goldman Sachs maintained a Conviction Buy on Walgreen (NYSE: WAG) with a price target of $84. Comments follow June sales data. Analyst Robert P. Jones noted that scripts continue to drive strong comps.

"WAG reported total June SSS of 7.5%, above GS/consensus of 5.1%/6.3%, with the 2-year stack improving to 9.8% from 7.2% last month. The beat was driven by strong script comps, which supports our view that script utilization is improving and should support toplines across the Supply Chain. Drug price inflation also helped drive the strong Rx comp in June, although we believe this will keep the debate alive around generic price inflation and lingering margin pressure. Front-end SSS also came in 100 bps light of our expectation with weaker traffic offsetting improved basket size – which could be a sign that WAG’s strategy of diving sales with its most loyal customers is taking shape," he said.

For an analyst ratings summary and ratings history on Walgreen click here. For more ratings news on Walgreen click here.

Shares of Walgreen closed at $73.04 yesterday.

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