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Walgreen Co. (NYSE: WAG)

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Walgreen Company is the world's largest drug retailer, operates retail drug store and general merchandise. It is engaged in the retail sale of prescription and non-prescription drugs and general merchandise.

 

The stock closed the last trading session at $40.13. In the past year, the stock has hit a 52-week low of $28.53 and 52-week high of $42.00. Technical indicators for the stock are neutral. WAG has a market cap of $37.93 billion and is part of the services sector.

 

BALANCE SHEET

 

Net earnings for the first quarter ended November 30, 2012 were $413 million or $.43 per diluted share. This was a 25.5% decrease in net earnings over the same quarter last year. Quarter net earnings and net earnings per diluted share, respectively, was $59 million, or $.06 per diluted share, in acquisition-related amortization, $34 million, or $.04 per diluted share. Net sales for the quarter ended November 30, 2012 decreased by 4.6% to $17.3 billion.

 

VALUATION

 

WAG PE stands at 18.16 above the industry’s average of 17.26. The stock is currently trading 6% below its intrinsic value of $42.80 this suggests that the stock is undervalued at these levels. WAG’s current Price/Sales of 0.54 is at the average of its industry of 0.52. The beta of 1.28 implies higher volatility of the stock with respect to the S&P 500. The firm pays a 2.6% dividend yield. WAG’s Total Debt/Equity is 34.70%

 

The company has demonstrated neutral technical signs, the company stands on very sound financial footing but lower sales makes us cautious at current price level. WAG stock is 8.43% higher year to date. My overall score for WAG is 5.00/10.00

 

I am neutral on the stock.

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