Walgreens Boots Alliance Nearly Halves Dividend To Strengthen Balance Sheet, Reports Better Than Expected Q1 Earnings
Portfolio Pulse from Vandana Singh
Walgreens Boots Alliance Inc (WBA) reported Q1 FY24 sales of $36.7 billion, a 10% increase year-over-year, surpassing expectations. Adjusted operating income fell 33% to $687 million, and adjusted EPS dropped 43.1% to $0.66, still beating estimates. Comparable sales in U.S. retail pharmacy rose 8.1%, but total prescriptions filled remained flat. WBA cut its quarterly dividend by 48% to $0.25 per share. The company reaffirmed its FY24 adjusted EPS guidance of $3.20-$3.50, with U.S. Healthcare adjusted EBITDA expected to break even. WBA shares fell 9.80% to $23.07.
January 04, 2024 | 3:27 pm
News sentiment analysis
Sort by:
Ascending
NEGATIVE IMPACT
Walgreens Boots Alliance reported higher than expected Q1 sales but saw a significant drop in adjusted EPS and operating income. The company also slashed its dividend by nearly half to strengthen its balance sheet.
The cut in dividends is a significant negative signal to investors, often interpreted as a lack of confidence in future cash flows. Despite better than expected sales, the drop in adjusted EPS and operating income, coupled with a reduced dividend, is likely to have a negative short-term impact on investor sentiment and the stock price.
CONFIDENCE 90
IMPORTANCE 90
RELEVANCE 100