Walgreens reported an EPS of -$0.31, missing the estimated EPS of $0.37, indicating a notable decline in profitability.
The company generated a revenue of approximately $39.46 billion, surpassing the estimated $37.42 billion and marking a 7.5% increase year over year.
Financial ratios reveal a debt-to-equity ratio of 2.75 and a current ratio of 0.64, highlighting potential financial and liquidity challenges.
Walgreens Boots Alliance Inc (NASDAQ: WBA) is a global leader in retail and wholesale pharmacy. It operates in over 25 countries, providing health and wellness products and services. Walgreens competes with other major pharmacy chains like CVS Health and Rite Aid. The company recently reported its earnings for the first quarter ending November 2024.
On January 10, 2025, Walgreens reported an earnings per share (EPS) of -$0.31, missing the estimated EPS of $0.37. This is a notable decline from the $0.51 EPS reported for the first quarter, which had already decreased from $0.66 in the same quarter the previous year. Despite this, the company experienced a significant stock price increase after surpassing expectations in its first-quarter earnings.
Walgreens generated a revenue of approximately $39.46 billion, exceeding the estimated $37.42 billion. This marks a 7.5% increase year over year, or 6.9% on a constant currency basis, as highlighted by Zacks Investment Research. The robust sales growth across all segments indicates strong market performance, further supported by the company’s reaffirmation of its annual profit forecast.
The company’s financial ratios provide additional insights into its market position. Walgreens has a price-to-sales ratio of about 0.07, meaning investors pay 7 cents for every dollar of sales. The enterprise value to sales ratio is around 0.26, suggesting a relatively low valuation compared to its sales. However, the enterprise value to operating cash flow ratio is high at 34.23, indicating a premium based on cash flow generation.
Walgreens’ debt-to-equity ratio stands at 2.75, showing a significant amount of debt compared to equity. This could be a concern for investors, as it suggests reliance on borrowed funds. Additionally, the current ratio of 0.64 points to potential liquidity challenges, as the company may struggle to cover short-term liabilities with its current assets.
