Walgreen Profit Falls 8%, Beats Estimates
NEW YORK (TheStreet) -- Walgreen's(WAG) fiscal second-quarter earnings fell almost 8% but topped analysts' estimates.
The drugstore chain earned $683 million, or 78 cents a share, in the quarter, down from $739 million, or 80 cents a share, a year earlier.
Analysts were expecting profit of 77 cents a share.
"We continue making significant progress on our 'Well at Walgreens' strategy to become America's first choice for health and daily living, as indicated by our record sales and strong front-end performance," said Walgreen CEO Greg Wasson, in a statement Tuesday. "As we enter the upcoming pharmacy benefit manager selling season, which appears to be an unusually active one, we feel confident as more PBMs, health plans and others approach Walgreens about developing member services and benefits that can be offered to clients."
One pharmacy benefit manager Walgreen hasn't been working with this year is Express Scripts(ESRX) . The two began to part ways last June when Walgreen said contract re-negotiations with Express Scripts failed. Walgreen said no longer being part of the Express Scripts network hurt earnings by 7 cents a share.
Second-quarter sales rose to about $18.7 billion from $18.5 billion a year ago. Prescription sales fell 1.7% in the quarter.
Shares of Walgreen rose 14 cents in premarket trading Tuesday to $34.51. The stock has risen 3.96% year to date.
TheStreet Ratings gives Walgreen a B grade with a buy rating and a $37.85 price target.