U.S. drugstore chain operator Walgreens Boots Alliance Inc. (WBA) reported on Thursday second-quarter earnings above analysts’ expectations as consumers stock up on over-the-counter medicine, prescriptions, cleaning and hygiene products.
Walgreens said that the impact from the coronavirus pandemic began at the end of the second quarter and was not “material” to overall results. Looking ahead Walgreens cautioned that to date the company was not in a “position to accurately forecast the future impacts.”
In the second quarter ended Feb. 29, Walgreens net income fell to $946 million, or $1.07 per share, from $1.16 billion, or $1.24 per share, in the year earlier period. Walgreens posted adjusted EPS of $1.52, beating the EPS of $1.46 analysts were expecting.
Revenue grew to $35.82 billion, from $34.53 billion last year versus the $35.27 billion analysts expected. U.S. retail pharmacy sales rose 3.8% to $27.2 billion in the quarter from the same period a year ago.
Wall Street analysts have a Hold consensus rating for the drugstore chain based on 5 Holds and 1 Sell. The $57.17 average price target implies a potential 40% gain in the shares should the target be met. (See Walgreens stock market analysis)
In addition, Walgreens confirmed that the drugstore chain was on target to generate more than $1.8 billion in annual cost savings by fiscal 2022. Net cash provided by operating activities was $1.4 billion in the second quarter and free cash flow was $1.1 billion.
Walgreens declared a quarterly dividend of 45.75 cents per share, unchanged from the previous quarter and an increase of 4% from the year-ago quarter. The dividend was paid on March 12, 2020.
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