WALGREENS BOOTS ALLIANCE INC (WBA)
US9314271084 - Common Stock
Overall WBA gets a fundamental rating of 3 out of 10. We evaluated WBA against 40 industry peers in the Consumer Staples Distribution & Retail industry. Both the profitability and financial health of WBA have multiple concerns. WBA is not valued too expensively and it also shows a decent growth rate. WBA also has an excellent dividend rating.
1. Profitability
1.1 Basic Checks
WBA had positive earnings in the past year.
WBA had a positive operating cash flow in the past year.
WBA had positive earnings in 4 of the past 5 years.
In the past 5 years WBA always reported a positive cash flow from operatings.
1.2 Ratios
The Return On Assets of WBA (-7.17%) is worse than 77.50% of its industry peers.
Looking at the Return On Equity, with a value of -44.77%, WBA is doing worse than 80.00% of the companies in the same industry.
The Return On Invested Capital of WBA (2.63%) is worse than 65.00% of its industry peers.
Measured over the past 3 years, the Average Return On Invested Capital for WBA is significantly below the industry average of 10.24%.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | -7.17% | ||
| ROE | -44.77% | ||
| ROIC | 2.63% |
ROA(3y)1.58%
ROA(5y)2.23%
ROE(3y)4.21%
ROE(5y)6.36%
ROIC(3y)4.72%
ROIC(5y)6.04%
1.3 Margins
With a Operating Margin value of 1.36%, WBA is not doing good in the industry: 62.50% of the companies in the same industry are doing better.
WBA's Operating Margin has declined in the last couple of years.
WBA has a worse Gross Margin (18.56%) than 60.00% of its industry peers.
In the last couple of years the Gross Margin of WBA has declined.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 1.36% | ||
| PM (TTM) | N/A | ||
| GM | 18.56% |
OM growth 3Y-11.45%
OM growth 5Y-15.36%
PM growth 3YN/A
PM growth 5YN/A
GM growth 3Y-1.08%
GM growth 5Y-3.65%
2. Health
2.1 Basic Checks
The Return on Invested Capital (ROIC) is below the Cost of Capital (WACC), so WBA is destroying value.
WBA has about the same amout of shares outstanding than it did 1 year ago.
The number of shares outstanding for WBA has been reduced compared to 5 years ago.
Compared to 1 year ago, WBA has an improved debt to assets ratio.
2.2 Solvency
An Altman-Z score of 2.24 indicates that WBA is not a great score, but indicates only limited risk for bankruptcy at the moment.
Looking at the Altman-Z score, with a value of 2.24, WBA is doing worse than 67.50% of the companies in the same industry.
WBA has a Debt/Equity ratio of 0.63. This is a neutral value indicating WBA is somewhat dependend on debt financing.
Looking at the Debt to Equity ratio, with a value of 0.63, WBA is in line with its industry, outperforming 42.50% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.63 | ||
| Debt/FCF | N/A | ||
| Altman-Z | 2.24 |
ROIC/WACC0.37
WACC7.1%
2.3 Liquidity
WBA has a Current Ratio of 0.66. This is a bad value and indicates that WBA is not financially healthy enough and could expect problems in meeting its short term obligations.
The Current ratio of WBA (0.66) is worse than 90.00% of its industry peers.
A Quick Ratio of 0.32 indicates that WBA may have some problems paying its short term obligations.
With a Quick ratio value of 0.32, WBA is not doing good in the industry: 80.00% of the companies in the same industry are doing better.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 0.66 | ||
| Quick Ratio | 0.32 |
3. Growth
3.1 Past
The earnings per share for WBA have decreased strongly by -13.48% in the last year.
The Earnings Per Share has been decreasing by -7.90% on average over the past years.
The Revenue has grown by 8.48% in the past year. This is quite good.
The Revenue has been growing slightly by 1.12% on average over the past years.
EPS 1Y (TTM)-13.48%
EPS 3Y-5.58%
EPS 5Y-7.9%
EPS growth Q2Q3.45%
Revenue 1Y (TTM)8.48%
Revenue growth 3Y-0.11%
Revenue growth 5Y1.12%
Revenue growth Q2Q6.28%
3.2 Future
The Earnings Per Share is expected to grow by 2.48% on average over the next years.
WBA is expected to show a small growth in Revenue. In the coming years, the Revenue will grow by 3.99% yearly.
EPS Next Y-18.47%
EPS Next 2Y-11.59%
EPS Next 3Y-4.27%
EPS Next 5Y2.48%
Revenue Next Year4.96%
Revenue Next 2Y4.4%
Revenue Next 3Y4.09%
Revenue Next 5Y3.99%
3.3 Evolution
When comparing the EPS growth rate of the last years to the growth rate of the upcoming years, we see that the growth is accelerating.
The Revenue growth rate is accelerating: in the next years the growth will be better than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
The Price/Earnings ratio is 5.05, which indicates a rather cheap valuation of WBA.
Compared to the rest of the industry, the Price/Earnings ratio of WBA indicates a rather cheap valuation: WBA is cheaper than 97.50% of the companies listed in the same industry.
Compared to an average S&P500 Price/Earnings ratio of 28.28, WBA is valued rather cheaply.
Based on the Price/Forward Earnings ratio of 5.71, the valuation of WBA can be described as very cheap.
97.50% of the companies in the same industry are more expensive than WBA, based on the Price/Forward Earnings ratio.
WBA's Price/Forward Earnings ratio indicates a rather cheap valuation when compared to the S&P500 average which is at 20.88.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 5.05 | ||
| Fwd PE | 5.71 |
4.2 Price Multiples
Based on the Enterprise Value to EBITDA ratio, WBA is valued cheaply inside the industry as 82.50% of the companies are valued more expensively.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | N/A | ||
| EV/EBITDA | 5.66 |
4.3 Compensation for Growth
WBA's earnings are expected to decrease with -4.27% in the coming years. This may justify a cheaper valuation.
PEG (NY)N/A
PEG (5Y)N/A
EPS Next 2Y-11.59%
EPS Next 3Y-4.27%
5. Dividend
5.1 Amount
WBA has a Yearly Dividend Yield of 5.70%, which is a nice return.
In the last 3 months the price of WBA has falen by -21.33%. A price decline artificially increases the dividend yield. It may be a sign investors do not expect the dividend to last.
Compared to an average industry Dividend Yield of 2.55, WBA pays a better dividend. On top of this WBA pays more dividend than 97.50% of the companies listed in the same industry.
WBA's Dividend Yield is rather good when compared to the S&P500 average which is at 2.41.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 5.7% |
5.2 History
The dividend of WBA has a limited annual growth rate of 1.75%.
WBA has paid a dividend for at least 10 years, which is a reliable track record.
WBA has not decreased its dividend for at least 10 years, so it has a reliable track record of non decreasing dividend.
Dividend Growth(5Y)1.75%
Div Incr Years19
Div Non Decr Years19
5.3 Sustainability
WBA has negative earnings and hence a negative payout ratio. The dividend may be in danger.
The dividend of WBA is growing, but earnings are growing more, so the dividend growth is sustainable.
DP-27.46%
EPS Next 2Y-11.59%
EPS Next 3Y-4.27%
WALGREENS BOOTS ALLIANCE INC
NASDAQ:WBA (5/3/2024, 7:26:05 PM)
After market: 17.77 -0.04 (-0.22%)17.81
+0.28 (+1.6%)
Chartmill FA Rating
GICS SectorConsumer Staples
GICS IndustryGroupConsumer Staples Distribution & Retail
GICS IndustryConsumer Staples Distribution & Retail
Earnings (Last)
Earnings (Next)
Inst Owners
Inst Owner Change
Ins Owners
Ins Owner Change
Market Cap15.36B
Analysts
Price Target
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 5.7% |
Dividend Growth(5Y)
DP
Div Incr Years
Div Non Decr Years
Ex-Date
Surprises & Revisions
EPS beat(2)
Avg EPS beat(2)
Min EPS beat(2)
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EPS beat(8)
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EPS beat(12)
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EPS beat(16)
Avg EPS beat(16)
Revenue beat(2)
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Min Revenue beat(2)
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Revenue beat(4)
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Revenue beat(8)
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Revenue beat(12)
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Revenue beat(16)
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PT rev (1m)
PT rev (3m)
EPS NQ rev (1m)
EPS NQ rev (3m)
EPS NY rev (1m)
EPS NY rev (3m)
Revenue NQ rev (1m)
Revenue NQ rev (3m)
Revenue NY rev (1m)
Revenue NY rev (3m)
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 5.05 | ||
| Fwd PE | 5.71 | ||
| P/S | |||
| P/FCF | |||
| P/OCF | |||
| P/B | |||
| P/tB | |||
| EV/EBITDA |
EPS(TTM)
EY
EPS(NY)
Fwd EY
FCF(TTM)
FCFY
OCF(TTM)
OCFY
SpS
BVpS
TBVpS
PEG (NY)N/A
PEG (5Y)N/A
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | -7.17% | ||
| ROE | -44.77% | ||
| ROCE | |||
| ROIC | |||
| ROICexc | |||
| ROICexgc | |||
| OM | 1.36% | ||
| PM (TTM) | N/A | ||
| GM | 18.56% | ||
| FCFM |
ROA(3y)
ROA(5y)
ROE(3y)
ROE(5y)
ROIC(3y)
ROIC(5y)
ROICexc(3y)
ROICexc(5y)
ROICexgc(3y)
ROICexgc(5y)
ROCE(3y)
ROCE(5y)
ROICexcg growth 3Y
ROICexcg growth 5Y
ROICexc growth 3Y
ROICexc growth 5Y
OM growth 3Y
OM growth 5Y
PM growth 3Y
PM growth 5Y
GM growth 3Y
GM growth 5Y
F-Score
Asset Turnover1.72
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.63 | ||
| Debt/FCF | |||
| Debt/EBITDA | |||
| Cap/Depr | |||
| Cap/Sales | |||
| Interest Coverage | |||
| Cash Conversion | |||
| Profit Quality | |||
| Current Ratio | 0.66 | ||
| Quick Ratio | 0.32 | ||
| Altman-Z |
F-Score
WACC
ROIC/WACC
Cap/Depr(3y)
Cap/Depr(5y)
Cap/Sales(3y)
Cap/Sales(5y)
Profit Quality(3y)
Profit Quality(5y)
Growth
EPS 1Y (TTM)-13.48%
EPS 3Y-5.58%
EPS 5Y
EPS growth Q2Q
EPS Next Y-18.47%
EPS Next 2Y
EPS Next 3Y
EPS Next 5Y
Revenue 1Y (TTM)8.48%
Revenue growth 3Y-0.11%
Revenue growth 5Y
Revenue growth Q2Q
Revenue Next Year
Revenue Next 2Y
Revenue Next 3Y
Revenue Next 5Y
EBIT growth 1Y
EBIT growth 3Y
EBIT growth 5Y
EBIT Next Year
EBIT Next 3Y
EBIT Next 5Y
FCF growth 1Y
FCF growth 3Y
FCF growth 5Y
OCF growth 1Y
OCF growth 3Y
OCF growth 5Y