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Rite Aid's Comps Rises Again - Analyst Blog

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Rite Aid Corporation ( RAD ), a leading drugstore chain operator, reported an increase of 1.9% in same-store sales for November 2011. Increase in comparable store sales was primarily driven by increased prescription counts and growth at pharmacy same store sales, partially offset by a decline in same store sales at front-end.

For the month of November, front-end same-store sales inched down 0.6%. However, Pharmacy same-store sales improved 3.1 % despite a 182 basis point headwind from new generic introductions. Besides, prescriptions count also increased 0.8% at comparable stores.

Total drugstore sales inched up 1.4% year over year to $2,404 million for November 2011. During the period, prescription revenue contributed 68% of drugstore sales while third party prescription revenue accounted for 96.6% of pharmacy sales.

For the thirteen-week period ended November 26, 2011, the company reported same store-sales increase of 2% with total drugstore sales increasing 1.8% to 6,289 million. The company's pharmacy same store sales reported a growth of 2.9%, while remaining flat for the front-end same store sales. Prescription counts registered a growth of 0.5% during the period.

For the above mentioned period, prescription revenue contributed 68.7% of drugstore sales while third party prescription revenue accounted for 96.4% of pharmacy sales.

For the thirty-nine week period ended November 26, 2011, the company reported an increase of 1.6% in comparable store sales with total drugstore sales rising 1.2% to $18,901 million. Same-store sales growth at pharmacy and front-end were 1.9% and 0.8%, respectively. Prescription counts registered a growth of 0.4% during the period.

For the same period, prescription revenue contributed 68.4% of drugstore sales while third party prescription revenue accounted for 96.4% of pharmacy sales.

Looking ahead, Rite Aid expects fiscal 2012 revenue to be between $25.8 billion and $26.1 billion based on same-store sales increase of 0.75% to 2.0%. Net loss is now expected to be in the range of $345 million to $495 million (or 40 cents to 56 cents per share).

Headquartered in Camp Hill, Pennsylvania, Rite Aid Corporation operates in a highly fragmented specialty retail sector and faces intense competition from CVS Caremark Corporation ( CVS ), Walgreen Co. ( WAG ) and Wal-Mart Stores Inc. ( WMT ).

Rite Aid Corporation currently has a Zacks #2 Rank, implying a short-term Buy rating on the stock. We hold a long-term Neutral recommendation on the stock.

CVS CAREMARK CP ( CVS ): Free Stock Analysis Report

RITE AID CORP ( RAD ): Free Stock Analysis Report

WALGREEN CO ( WAG ): Free Stock Analysis Report

WAL-MART STORES ( WMT ): Free Stock Analysis Report

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.


The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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