Walgreens Boots Alliance Inc (NASDAQ:WBA, ETR:W8A), the retail pharmacist, will likely showcase how its strategy is evolving under newly appointed CEO Tim Wentworth at its second quarter update on Thursday.
Wentworth took charge of the group back in October 2023 but analysts are keen to learn about how he plans to deploy capital from sales over the long term and whether a ‘back to basics’ plan will be launched.
Bank of America analysts wonder whether the business will look to exit some of its non-core ventures and refocus on traditional pharmacy.
“While the new CEO works to address structural headwinds in pharmacy and drive toward a new strategy, we expect the path to sustained growth will take time,” the US bank explained.
Despite seeing the light at the end of the tunnel, analysts are aware that core headwinds and uncertainty in growth outlooks persist.
Therefore, the bank has reduced second-quarter earnings per share estimates from US$0.85 to US$0.81, compared to Wall Street forecasts of US$0.82.
Full-year EPS guidance has also been lowered by a cent to US$3.18, lower than the consensus of US$3.27.
“Our estimate revisions reflect modestly lower front-end sales within U.S. Retail Pharmacy,” Bank of America said.
Walgreens Boots Alliance is rated ‘underperform’ by BoA and its share price target has been decreased to US$22, representing a 6% premium to its current market value.