Walgreens (NASDAQ:WBA) stores will be closing as the company’s CEO announces that “imminent” changes need to happen at the struggling pharmacy chain.
According to CEO Tim Wentworth, Walgreens has continued to have trouble courting customers as they are resistant to current prices. This comes as inflation is weighing on the economy and causing consumer spending to fall.
As a result, Wentworth claims that Walgreens will be looking over its stores to gauge which ones to close. He claims that 75% of the company’s stores “drive 100%” of its profitability. This suggests the retail chain could close as much as 25% of its 8,600 locations in the United States.
Walgreens Stores Closing After Poor Earnings
News of Walgreens closing stores comes after its latest earnings report failed to impress investors. It reported adjusted earnings per share of 63 cents, which was well below Wall Street’s estimate of 71 cents for the quarter.
Walgreens also lowered its adjusted EPS estimate for 2024 to between $2.80 and $2.95. That will see it miss Wall Street’s estimate of $3.20 per share.
WBA stock is down 24.6% as of Thursday afternoon. This comes with some 83 million shares traded, as compared to a daily average of about 12.6 million shares. The stock is also down 55.7% since the start of the year.
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On the date of publication, William White 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.
