UPDATE - UBS Initiates Coverage on Walgreen (WAG) with a Buy; Generics + SG&A Leverage = EPS Growth
Tweet
Share
E-mailGet Alerts WAG Hot Sheet
Price: $76.05 --0%
Rating Summary:
0 Buy, 0 Hold, 0 Sell
Rating Trend: = Flat
Today's Overall Ratings:
Up: 16 | Down: 11 | New: 13
Rating Summary:
0 Buy, 0 Hold, 0 Sell
Rating Trend: = Flat
Today's Overall Ratings:
Up: 16 | Down: 11 | New: 13
Join SI Premium – FREE
UPDATE - UBS initiates coverage on Walgreen (NYSE: WAG) with a Buy rating. PT $51.
UBS analyst said, "While we believe that WAG will capture a decent amount of incremental EPS growth from the generic wave ($0.21 in C2012 or 9% pts EPS growth), the growth story should have legs well beyond that from maturation of newer stores. The associated operating leverage is one of the linchpins to our projected mid-teens EPS growth beyond calendar 2012."
"WAG story longer-term is more about store leverage than generics - By combining this lower SG&A spend with gross profit leverage from the generic wave, plus an acceleration in share buybacks, and recovery in front-end sales with economic improvement, we believe Street numbers are still too low for FY12-13. We project EPS of $3.06 and $3.51 for FY12 and 13, respectively, (+17% and +14% growth), which are above current Street estimates of $2.98 and $3.45."
UBS analyst said, "While we believe that WAG will capture a decent amount of incremental EPS growth from the generic wave ($0.21 in C2012 or 9% pts EPS growth), the growth story should have legs well beyond that from maturation of newer stores. The associated operating leverage is one of the linchpins to our projected mid-teens EPS growth beyond calendar 2012."
"WAG story longer-term is more about store leverage than generics - By combining this lower SG&A spend with gross profit leverage from the generic wave, plus an acceleration in share buybacks, and recovery in front-end sales with economic improvement, we believe Street numbers are still too low for FY12-13. We project EPS of $3.06 and $3.51 for FY12 and 13, respectively, (+17% and +14% growth), which are above current Street estimates of $2.98 and $3.45."
Serious News for Serious Traders! Try StreetInsider.com Premium Free!
You May Also Be Interested In
- Lake Street Capital Markets Starts Research Solutions Inc. (RSSS) at Buy
- BofA Securities Reinstates Petronet LNG Ltd. (PLNG:IN) at Neutral
- Canaccord Genuity Starts Pan African Resources PLC (PAF:LN) at Buy
Create E-mail Alert Related Categories
New CoverageRelated Entities
UBSSign up for StreetInsider Free!
Receive full access to all new and archived articles, unlimited portfolio tracking, e-mail alerts, custom newswires and RSS feeds - and more!
