Keeping perfectly in line with its strategy of long-term
growth and value creation,
), recently, came up with its second 'Well Experience' flagship
store in the Empire State Building, NYC. Earlier this month,
Walgreens opened its first 'Well Experience' store in Washington,
D.C. The company expects the launch of the third store of this
kind in Boston by next month. The company is optimistic about
this strategic step and believes that these select locations will
strengthen Walgreens' brand name in important markets.
According to Walgreens, this New York store will be full of
innovative features including an advanced pharmacy allowing
better interaction between pharmacists and patients, a health
guide to assist the customers, healthcare services including
immunizations and health tests as well as a private consultation
rooms and Express Rx kiosks. In addition, there will be a
boutique beauty department and many more.
Apart from this 'Well Experience' store roll out, Walgreen has
taken a number of strategic steps for long-term growth. The
company recently disclosed a 10-year comprehensive primary
distribution agreement with
) for branded and generic products. In addition, the company will
partner AmerisourceBergen on worldwide supply chain
opportunities. In addition, the contract between these two
stalwarts will enhance equity alignment of Walgreens, allowing
both the companies to participate in a joint value creation.
Furthermore, Walgreens is working well with its community
pharmacy transformation strategy. As a part of the national
healthcare reform, in the last reported quarter the company along
with three physician teams formed an accountable care
Notably, as a part of the important strategic steps by
Walgreens, the company introduced a customer loyalty program -
Balance Rewards in Sep 2012. This program is currently gaining
traction and has recorded more than 60 million registrations to
date. Even amid a challenging macroeconomic scenario, we are
encouraged with the performance of Balance Rewards and expect
this to improve customer traffic further in the coming quarters.
However, the company is susceptible to macroeconomic
headwinds. It also faces increased competition and tough industry
conditions. The tussle to gain market share with
CVS Caremark Corporation
) is another cause of concern. Therefore, we prefer to remain on
the sidelines and keep track of the ongoing developments.
Walgreens currently carries a Zacks Rank #3 (Hold).
While we remain on the sidelines for the company, another medical
device stock such as
) carries a Zacks Rank #1 (Strong Buy) and warrants a look.
AMERISOURCEBRGN (ABC): Free Stock Analysis
CVS CAREMARK CP (CVS): Free Stock Analysis
CYBERONICS INC (CYBX): Free Stock Analysis
WALGREEN CO (WAG): Free Stock Analysis Report
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