Financial Contrast: Rite Aid Corporation (RAD) and Walgreens Boots Alliance (WBA)
Rite Aid Corporation (NYSE: RAD) and Walgreens Boots Alliance (NASDAQ:WBA) are both mid-cap retail/wholesale companies, but which is the superior stock? We will compare the two businesses based on the strength of their valuation, institutional ownership, analyst recommendations, profitabiliy, dividends, risk and earnings.
This is a breakdown of current ratings and price targets for Rite Aid Corporation and Walgreens Boots Alliance, as reported by MarketBeat.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|Rite Aid Corporation||0||2||3||0||2.60|
|Walgreens Boots Alliance||1||3||11||0||2.67|
Rite Aid Corporation presently has a consensus target price of $6.11, suggesting a potential upside of 81.92%. Walgreens Boots Alliance has a consensus target price of $90.33, suggesting a potential upside of 13.19%. Given Rite Aid Corporation’s higher probable upside, equities research analysts clearly believe Rite Aid Corporation is more favorable than Walgreens Boots Alliance.
Valuation & Earnings
This table compares Rite Aid Corporation and Walgreens Boots Alliance’s revenue, earnings per share (EPS) and valuation.
|Gross Revenue||Price/Sales Ratio||EBITDA||Earnings Per Share||Price/Earnings Ratio|
|Rite Aid Corporation||$32.85 billion||0.11||$1.10 billion||N/A||N/A|
|Walgreens Boots Alliance||$116.08 billion||0.74||$7.73 billion||$3.91||20.41|
Walgreens Boots Alliance has higher revenue and earnings than Rite Aid Corporation.
Walgreens Boots Alliance pays an annual dividend of $1.50 per share and has a dividend yield of 1.9%. Rite Aid Corporation does not pay a dividend. Walgreens Boots Alliance pays out 38.4% of its earnings in the form of a dividend.
Volatility & Risk
Rite Aid Corporation has a beta of 1.85, suggesting that its stock price is 85% more volatile than the S&P 500. Comparatively, Walgreens Boots Alliance has a beta of 1.2, suggesting that its stock price is 20% more volatile than the S&P 500.
This table compares Rite Aid Corporation and Walgreens Boots Alliance’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|Rite Aid Corporation||0.01%||11.35%||0.61%|
|Walgreens Boots Alliance||3.66%||16.86%||7.22%|
Insider and Institutional Ownership
56.9% of Rite Aid Corporation shares are held by institutional investors. Comparatively, 61.3% of Walgreens Boots Alliance shares are held by institutional investors. 2.3% of Rite Aid Corporation shares are held by company insiders. Comparatively, 13.5% of Walgreens Boots Alliance shares are held by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company is poised for long-term growth.
Walgreens Boots Alliance beats Rite Aid Corporation on 11 of the 15 factors compared between the two stocks.
Rite Aid Corporation Company Profile
Rite Aid Corporation is a retail drugstore chain. The Company’s segments include Retail Pharmacy and Pharmacy Services. The Company operates under The Rite Aid name. It operates approximately 4,560 stores in over 30 states across the country and in the District of Columbia. The Company’s Retail Pharmacy segment consists of Rite Aid stores, RediClinic and Health Dialog. It sells brand and generic prescription drugs, as well as an assortment of front-end products, including health and beauty aids, personal care products, seasonal merchandise, and a private brand product line. Its front-end products include over-the-counter medications, health and beauty aids, personal care items, cosmetics, household items, food and beverages, greeting cards, seasonal merchandise and numerous other everyday and convenience products. The Company’s Pharmacy Services segment consists of EnvisionRx, which provides a range of pharmacy benefit services.
Walgreens Boots Alliance Company Profile
Walgreens Boots Alliance, Inc. (Walgreens Boots Alliance) is a holding company. The Company is a global pharmacy-led, health and wellbeing enterprise. Walgreens Boots Alliance operates through three divisions, including Retail Pharmacy USA, Retail Pharmacy International and Pharmaceutical Wholesale. The Company’s products are marketed under a number of brands, which include No7, the Botanics range, Almus (generic medicines), Boots Pharmaceuticals and Soap & Glory (bathing and beauty brand). In addition, the Company has investments in Guangzhou Pharmaceuticals Corporation and Nanjing Pharmaceutical Company Limited. The Company operates in around 25 countries, which include the wholesale and distribution network with over 340 distribution centers and more than 180,000 pharmacies, health centers and hospitals in 19 countries.
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