It's Time To Buy Walgreen (WAG) - Analyst
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Price: $76.05 --0%
Rating Summary:
0 Buy, 0 Hold, 0 Sell
Rating Trend: = Flat
Today's Overall Ratings:
Up: 3 | Down: 4 | New: 10
Rating Summary:
0 Buy, 0 Hold, 0 Sell
Rating Trend: = Flat
Today's Overall Ratings:
Up: 3 | Down: 4 | New: 10
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Shares of Walgreen Co. (NYSE: WAG) are mildly higher in early trading Tuesday after Credit Suisse upgraded its rating on the stock from Neutral to Outperform.
Credit Suisse analyst E. Kelly said a continued fundamental turnaround, strong accretion from the generic pharmaceutical wave and unique leverage to Consumer Packaged Goods inflation and insulation from high gas prices makes the stock a "compelling investment idea."
"While near-term momentum has stalled following Q2 earnings, we still believe the 2012 outlook remains underappreciated and see the recent pullback as a buying opportunity."
Kelly said, while they have been critical of Walgreen’s execution in the past, they now believe its turnaround is finally beginning to take hold. “Sales have improved, management's focus on more profitable growth has boosted margins, SG&A has surprised on the upside, and free cash flow allocation has improved dramatically,” the analyst said.
The firm set a $46 per share 12-month price target on the stock, suggesting 17 percent upside from current levels.
Credit Suisse projects that calendar 2012 earnings could reach $3.20 to $3.25 per share, which would eclipse the consensus of $3.12. Fiscal 2012 earnings per share is seen at $3.05, versus the consensus of $2.99.
Shares of Walgreen last traded at $39.61, up 0.76 percent.
Credit Suisse analyst E. Kelly said a continued fundamental turnaround, strong accretion from the generic pharmaceutical wave and unique leverage to Consumer Packaged Goods inflation and insulation from high gas prices makes the stock a "compelling investment idea."
"While near-term momentum has stalled following Q2 earnings, we still believe the 2012 outlook remains underappreciated and see the recent pullback as a buying opportunity."
Kelly said, while they have been critical of Walgreen’s execution in the past, they now believe its turnaround is finally beginning to take hold. “Sales have improved, management's focus on more profitable growth has boosted margins, SG&A has surprised on the upside, and free cash flow allocation has improved dramatically,” the analyst said.
The firm set a $46 per share 12-month price target on the stock, suggesting 17 percent upside from current levels.
Credit Suisse projects that calendar 2012 earnings could reach $3.20 to $3.25 per share, which would eclipse the consensus of $3.12. Fiscal 2012 earnings per share is seen at $3.05, versus the consensus of $2.99.
Shares of Walgreen last traded at $39.61, up 0.76 percent.
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