Walgreens Boots Alliance, Inc.WBA , a major pharmacy-led, health and wellbeing enterprise, recently announced collaboration with leading diagnostic service provider LabCorp (LH). Through the deal, LabCorp will build and operate patient service centers at select Walgreens stores. The centers, which will be known as "LabCorp at Walgreens," will offer patient services in a safe environment for specimen collection, located near the pharmacy area inside the store.
Seven "LabCorp at Walgreens" centers will start operating this year, with five patient service centers in Denver and one in Morrisville, North Carolina expected to open soon. The Deerfield, IL location is slated to open by the end of 2017.
The initial Walgreens Boots sites are said to be an addition to LabCorp's 1,750 existing patient service centers. Tests on specimen collected at these locations will be performed through LabCorp's nationwide network of primary and specialty laboratories.
Walgreens Boots' management stated in its press release that "This agreement brings together Walgreens trusted pharmacy and community health care services with LabCorp's long-standing reputation for innovation and quality in diagnostic laboratory testing". The former's main objective is to provide a broader range of enhanced health care services within the reach of patients.
Additionally, Walgreens Boots believes that making lab tests available at its retail locations complements the company's expanded services offered through its pharmacy and Healthcare Clinics. Management believes that the LabCorp relationship demonstrates the value of deeper collaborations with health care service providers in improving care coordination and providing greater benefit, care and service for patients and payers.
For LabCorp, this collaboration will improve its patient engagement in key markets across the U.S. and offer increased access to the company's broad range of laboratory services.
Share Price Performance
For the last one month, Walgreens Boots has been trading below the Zacks categorized Retail - Pharmacies and Drug Stores industry. The stock has lost 3.8%, in contrast to the 0.5% gain of the broader industry. The continuous regulatory opposition from FTC to acquire Rite-Aid has dented Walgreens Boots' share price. However, we expect the company's strategy of partnerships and acquisitions to eventually boost the price performance.
Zacks Rank & Key Picks
Walgreens Boots currently carries a Zacks Rank# 3 (Hold). Better-ranked medical stocks are Align Technology, Inc. ALGN , Inogen, Inc. INGN and Accelerate Diagnostics, Inc. AXDX . Notably, Inogen sports a Zacks Rank #1 (Strong Buy), while Align Technology and Accelerate Diagnostics carry a Zacks Rank #2 (Buy). You can see the complete list of today's Zacks #1 Rank stocks here.
Align Technology has an expected long-term adjusted earnings growth of almost 24.1%. The stock has added roughly 34% over the last three months.
Inogen has a long-term expected earnings growth rate of 17.5%. The stock has gained around 22.5% over the last three months.
Accelerate Diagnostics has an expected long-term adjusted earnings growth of 30%. The stock has added around 16% over the last three months.
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