) is scheduled to report its third-quarter fiscal 2014 results
before the opening bell on Jun 24. In the last reported second
quarter, this drug retail giant had posted a negative earnings
surprise of 2.15% after delivering two consecutive quarters of
in-line results. Let's see how things are shaping up for this
Factors at Play
As reported in the company's May-sales release, Walgreens' total
sales for the third quarter of fiscal 2014 came in at $19.45
billion, reflecting a sales growth of 4.3% year over year and a
marginal beat over the Zacks Consensus Estimate of $19.24
In May, the company also witnessed higher comparable store sales
and front-end comparable store sales. Additionally, prescriptions
filled at comparable stores and comparable pharmacy sales showed an
In its latest effort to boost its market presence, Walgreens has
decided to focus on its supply chain performance. We currently look
forward to synergies from the Alliance Boots deal. Besides, the
), likely to create a leader in the generic and branded drug
purchasing space, is another major upside.
Going ahead, Walgreens is optimistic about financial and
operational benefits from the AmerisourceBergen deal for fiscal
2014, with margin expansion and bottom-line accretion. Evidently,
management seems to have chalked out a number of strategic
initiatives to revive growth at the company.
Our proven model does not conclusively show that Walgreens is
likely to beat earnings this quarter. It is because a stock needs
to have both a positive
(Expected Surprise Prediction) and a Zacks Rank #1, 2 or 3 for this
to happen. That is not the case here as you will see below.
Earnings ESP for Walgreens is -1.06%, since the Most Accurate
estimate of 93 cents stands below the Zacks Consensus Estimate of
Although Walgreens' Zacks Rank #3 (Hold) increases the predictive
power of ESP, when combined with a -1.06% ESP, it makes surprise
Other Stocks to Consider
Here are two other companies you may want to consider as our
model shows they have the right combination of elements to post an
earnings beat this quarter:
Cardinal Health, Inc.
) has an earnings ESP of +2.50% and bears a Zacks Rank #3. Cardinal
Health will report fourth quarter fiscal 2014 earnings on Aug
Intuitive Surgical, Inc.
) has an earnings ESP of +8.19% and holds a Zacks Rank #3. The
company is expected to report its third quarter fiscal 2014
earnings on Jul 22.
Want the latest recommendations from Zacks Investment Research?
Today, you can download 7 Best Stocks for the Next 30 Days.
Click to get this free report
INTUITIVE SURG (ISRG): Free Stock Analysis
CARDINAL HEALTH (CAH): Free Stock Analysis
AMERISOURCEBRGN (ABC): Free Stock Analysis
WALGREEN CO (WAG): Free Stock Analysis Report
To read this article on Zacks.com click here.