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magazineThe owner of Boots loses a quarter of its value in six months
Shares in Walgreens Boots Alliance (WBA:NASDAQ), the owner of Walgreens and Boots, have lost over a quarter of their value in the past six months.
This fall to around the $31 mark is surprising considering the retail pharmacy giant raised its full-year sales outlook. Or is it?
Last year, the retail pharmacy giant abandoned plans to sell Boots, citing inability to find a buyer in difficult market conditions. This turned out to be a bit of good luck for the company as the UK division reported sales growth of 16% for the second quarter of 2023.
However, what wasn’t good for Walgreens is the prospect of paying out billions of dollars to settle thousands of lawsuits accusing the chain of mishandling opioid painkillers.
This had a knock-on effect for Walgreens’ earnings. During the first six months of its 2023 financial year, the pharmacy giant swung from a profit of $2.5 billion to an operating loss of nearly $6 billion.
With a sharp drop in income from Covid-related products and services, Walgreens is looking to its VillageMD primary care arm to help accelerate earnings growth.
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