Drugstore haven’t been immune to the economic slowdown we’ve seen lately, especially as online competitors and grocery store participants get involved. For Walgreens Boots Alliance (NASDAQ:WBA), the shifting market has hit them hard as well. Now, it’s pulling back on plans to offer an initial public offering (IPO) on the Boots name, and investors seem largely unfazed as shares were up fractionally in Friday afternoon’s trading.
Getting out from under Boots has been something of a plan for Walgreens for a while now, and it’s been looking into several options accordingly. It’s spoken to a few bidders already, albeit informally, and has even discussed matters with “financial sponsors.” No final decision has been made yet, and, as a report from Walgreens noted, “All options are on the table.” With Boots worth about seven billion pounds sterling—roughly U$8.9 billion—there could be quite a bit of value in bringing in the Boots name to the right buyer.
Frenzied Price Cuts
Retail, in general, is having a rough time of things, and as such, Walgreens has joined a slew of other budget retailers in cutting prices on everyday items. Reports note that Walgreens will be cutting prices on over 1,300 of those everyday items, including several different food items. Walgreens chief customer officer and retail president, Tracey D. Brown, noted “Walgreens understands our customers are under financial strain and struggle to purchase everyday items.” Brown then noted that Walgreens has been cutting prices since October of 2023.
Is Walgreens Boots Alliance Stock a Buy?
Turning to Wall Street, analysts have a Hold consensus rating on WBA stock based on two Buys, eight Holds, and three Sells assigned in the past three months, as indicated by the graphic below. After a 46.76% loss in its share price over the past year, the average WBA price target of $22.42 per share implies 41.23% upside potential.
