Are Walgreens Boots Alliance Investors Overreacting to the Company's Disappointing Earnings?
Walgreens Boots Alliance (NASDAQ: WBA) stock hit a 12-year low after the company reported earnings last month. Not only were the recent results not great, but the company is expecting some challenges ahead. But investors knew that this wasn't going to be a smooth road ahead -- the company is facing a decline, with fewer people obtaining vaccinations and the business investing into a new healthcare segment.
Have investors overreacted to the company's earnings results, and is Walgreens a good contrarian buy?
In recent years, Walgreens has been benefiting from rising traffic in its stores due to COVID vaccinations. But as demand for that has come down, the company's financials have worsened. Walgreens is facing rising costs due to inflation, and the increase in sales hasn't been enough to offset that. Revenue of $35.4 billion for the period ended May 31 represented an increase of 8.6% year over year, but the company's operating loss grew by 49% to $477 million as it incurred higher selling, general, and administrative expenses.
Source Fool.com
