In the 2020s, Walgreens Boots Alliance (NASDAQ:WBA) is set become more than just your average drugstore. The company has broader ambitions, including a major venture into primary healthcare. This, according to an analyst group, should help push WBA stock significantly higher.
Not long ago, Walgreens raised its revenue outlook for 2023, based on Walgreens-backed VillageMD’s plans to acquire urgent care provider Summit Health. VillageMD is a primary care provider, so clearly Walgreens is serious about its foray into healthcare.
So, Walgreens is seeking to be more than just a place to pick up medication and beauty supplies. As the company expands its horizons, Loop Capital analyst Joseph France is evidently preparing for Walgreens to deliver strong value to its shareholders.
France just initiated coverage of WBA stock with a “buy” rating and a $45 price target. Let’s see how this compares to the current share price — and how the market is reacting to Loop Capital’s new coverage.
What’s Happening With WBA Stock?
WBA stock is gaining less than 1% this morning, settling at around $36 per share. So, the market’s initial response to the new coverage was muted.
However, France’s $45 price target still suggests a 25% move to the upside from here. That would be a pretty decent return on investment for a stock that’s not typically a fast mover.
Per CNBC, France expects Walgreens’ new healthcare platform to improve services access for its customers. Overall, France seems quite bullish on the acquisition of Summit Health as a potential growth driver. The analyst explains:
“Much of our enthusiasm for WBA’s new healthcare business owes to its rollout of a national primary care platform, and the acquisition of new services for institutions and managing care at home.”
So, Loop Capital is keeping investors in the loop regarding Walgreens’ expansion plans. And if France is spot-on with his forecast, WBA stock could have significant room to run in 2023.
On the date of publication, David Moadel did not hold (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.