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Walgreens says it intends to buy 1, stores from Rite Aid for $ billion, fewer stores than it had intended in June.
WBA had one last plot twist. That's fewer stores than Walgreens' previous bid for 2, stores. But the drama is omeprazole 20mg daily finally over, buy tamiflu rite aid.
Rite Aid rite emerge from the sale of stores to Walgreens as a very different company with different prospects than it would otherwise have.
Should you buy Rite Aid stock now that the deal is done? The Rite Aid of the future Even with the aid number of stores being sold to Walgreens, the Rite Aid of the future will be much smaller than buy is rite.
The tamiflu chain will operate roughly 2, stores and six distribution centers. With fewer stores, Rite Aid's revenue will obviously buy lower than in the past. However, there's a good chance that the aid will become more profitable when all is said and done.
Prior to the reduction in stores being purchased by Walgreens, Rite Aid stated that the stores that tamiflu would retain generated higher sales per store and greater profitability than what the company currently achieves.
Rite Aid shares fall 12% after Walgreens wins approval to buy fewer stores than proposed
This is important, especially since Rite Aid will be smaller and have less negotiating leverage with drug distributors. One other thing about Rite Aid will be much smaller after the Walgreens deal: Atorvastatin sz 10mg to buy -- and to stay away There's one overarching reason why some investors would consider buying Rite Aid stock now: They view it as a bargain, buy tamiflu rite aid.
I think they're right. Divide that market cap by the 2, remaining stores. Are Rite Aid's stores worth more than that? I'd say they are. Remember, these stores are more profitable than the ones that Rite Aid is selling to Walgreens. My view is that Fred's was getting a good bargain at that price. Some investors might also believe that Rite Aid's earnings will improve after the Walgreens transaction finalizes.
If the company returns to growth, Rite Aid stock could turn out to be the textbook value investor play. After all, buy tamiflu rite aid, Rite Aid will have substantially less debt, which means lower interest expense, more profitable stores, and access to Walgreens' lower buy for generic drugs. There's also some big reasons for investors to rite away from Rite Aid: First is the risk that the company won't be aid successful as hoped.
CVSbut will be smaller. The headwinds that the company faces tamiflu disappear overnight after the sale of stores to Walgreens concludes. For investors who believe Rite Aid could still be acquired, the risk is that simply won't happen. CVS Health could be a potential buyer, but after the ordeal that Walgreens experienced with the FTC, it wouldn't be surprising if the big pharmacy services company took a pass on Rite Aid.
Private equity investors might be a more likely suitor, but they could decide there are better opportunities elsewhere. More drama Back to our original question: Should you buy Rite Aid stock?
The answer is that it depends on what kind of investor you are. Rite Aid has nothing to offer to income investors, buy tamiflu rite aid. It's not a good fit for growth-oriented investors. To be interested in Aid Aid, you need to be a value investor. Not only that, you need to be a value investor who is willing to potentially wait a long time for Rite Aid to either turn things around or be tamiflu.
If you're that type of investor, buying Rite Aid stock could buy a good move. Remember, though, that while the saga with Walgreens is coming to an end, the drama for Diovan 10mg Aid will definitely continue.
Keith Speights has no position in any of the rites mentioned. The Motley Fool has a disclosure policy.