Walgreens Boots Alliance, the global pharmacy chain, announced disappointing financial results in its most recent quarter and provided guidance for the next year that fell below Wall Street expectations. However, these results may not hold much weight as the company awaits the arrival of its new CEO, Tim Wentworth, and a replacement for its interim CFO.
The company reported adjusted earnings of $3.98 per share for the 2023 fiscal year, down from $5.04 in the previous year. Fourth-quarter adjusted earnings were 67 cents per share, slightly below the consensus estimate. Sales were $35.4 billion, just below estimates.
Walgreens provided adjusted earnings per share guidance for 2024 of $3.20 to $3.50, which is well below the consensus estimate. However, it remains to be seen how this guidance will be affected by the arrival of the new CEO.
Despite the disappointing financial results, Walgreens’ stock rose by 2.4% following the announcement. This may be attributed to the anticipation of Wentworth’s appointment and the potential for positive change within the company.
Walgreens has faced significant challenges in recent years, with falling earnings and a core U.S. pharmacy business that is struggling. The company has also invested heavily in a primary and urgent care chain that is not expected to be profitable for several years. As a result, the company’s shares have dropped by 39.5% this year.
Wentworth, who has experience as the CEO of Cigna’s pharmacy benefit manager division, will join the company in late October. He will have the task of turning around the company’s performance and addressing the challenges it faces.
Analysts have expressed mixed views on Walgreens’ future prospects. Some have lowered their target prices for the stock, while others have recommended changes in the company’s strategy, such as ending retail store leasebacks and reconsidering the dividend. The stock has also underperformed the broader market in recent years.
In conclusion, Walgreens’ disappointing financial results may have limited impact due to the imminent arrival of a new CEO. The company will be looking to Tim Wentworth to drive positive change and address the challenges it faces in the pharmacy industry. Only time will tell if the new leadership can turn the company’s fortunes around.