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Presented by: Bernadette Haddad. Ashraful Hoque. Roxanne Br

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Presented by: Bernadette Haddad. Ashraful Hoque. Roxanne Brandy. Uzo Mokolo. Justin Miller ... Walgreens mission is to offer customers the best drugstore ... – PowerPoint PPT presentation

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Title: Presented by: Bernadette Haddad. Ashraful Hoque. Roxanne Br


1
Presented
by Bernadette Haddad Ashraful Hoque
-------------------------------------------------
------------ Roxanne Brandy Uzo
Mokolo Justin Miller John Hoang
2
Mission Statement
  • Walgreens mission is to offer customers the best
    drugstore service in America. We are guided by a
    century-old tradition of fairness, trust and
    honesty as we continue to expand our store base
    and offer career opportunities to a fast-growing
    and diverse group of men and women. Our goal is
    to develop people who treat customers - and each
    other - with respect and dignity. We will support
    these efforts with the most innovative retail
    thinking, services and technology. The success we
    achieve will allow us to reinvest in our future
    and build long-term financial security for our
    employees and our shareholders.

3
Company Strategy
  • Enter new markets
  • Dense up existing markets
  • Relocate
  • Remodel
  • Invest heavily in high-tech store and
    distribution systems which drive service up and
    costs down
  • Offer an online drugstore web site, integrated
    with retail stores.

4
History
  • In 1901, Charles R. Walgreen Sr. purchased the
    Chicago drugstore where the start of the Walgreen
    chain began.
  • On October 31, 1997, the Intercom plus was put
    into the pharmacies to speed up the prescription
    filling process.

5
History
  • In 1981, the first intercom computers were
    installed in five Walgreens pharmacies in Des
    Moines, Iowa. This was the first step towards
    making Walgreens the first drugstore chain to
    connect all its pharmacy department via
    satellite.
  • In April 2002, Walgreens became the first
    drugstore chain to offer prescription labels in
    multiple languages chain wide.

6
The Exec.s
  • DAVID W. BERNAUER - 60  Chairman and Chief
    Executive Officer Walgreen Co.
  • JEROME B. KARLIN - 52  Executive Vice President
    - Drug Store Operations  Walgreen Co.
  • JEFFREY A. REIN - 62  President and Chief
    Operating Officer Walgreen Co.

7
Stock Ownership
8
Financial Ratio Analysis
  • Growth Rates EXCELLENT

9
Financial Ratio Analysis
  • Price Ratios EXCELLENT

10
Financial Ratio Analysis
  • Profit Margins SATISFACTORY

11
Financial Ratio Analysis
  • Financial Condition EXCELLENT

12
Financial Ratio Analysis
  • Investment Returns EXCELLENT

13
Financial Ratio Analysis
  • Management Efficiency EXCELLENT

14
Financial Ratios Conclusion
  • Based on its Financial Ratios, overall
    Walgreens is performing EXCELLENT

15
Industry Charts
16
Segment Revenue Chart
Majority of Walgreens revenue comes from
pharmaceutical products. The prescription drugs
holds 63.
17
As of April 1, 2005
  • Companies Share price 43.71
  • Daily Trading Volume 3.559 Million
  • Market Capitalization 44.64 Billion

18
Holding Period Return
  • In 2005, the Mean Target for the Price of Stock
    is expected to reach 45.43. Currently the price
    is 43.71. Therefore, the stock is UNDERPRICED.

19
Free Cash Flow to Equity
20
Discounted Cash Flow
21
Risk Analysis
Beta COV(RWAG,RSP500) VAR(RSP500)
22
Ke of Capital Assets
23
Weighted Average Cost of Capital
24
Capital Structure
25
M M Proposition
  • NO MODEL

26
Market Efficiency
  • Company Specific News
  • Walgreens announced its partnership with Ovation
    for the Medicare Part D Drug Program

No Form
27
Market Efficiency
  • Non-Company Specific News
  • Federal policy makers raise short term interest
    rates

Weak Form
28
5 Year Stock Price
  • Between 2001 and 2003 the stock prices had been
    fluctuating. After 2003, the stock prices has
    steadily been increasing and has reached its
    target price of 45.

29
Strengths Weaknesses
  • Strengths
  • Not a family Company
  • Low Beta
  • Increasing Net Income
  • Only has 1 insider ownership
  • Debt/Equity is stable
  • Consistent Positive Holding Period Return
  • Strong Return on Equity
  • Weaknesses
  • Weak inventory turnover
  • Higher Debt than Industry (not significantly
    higher to the extent that it would effect the
    company in a major way)

30
Analyst Opinion
31
Buy, Sell, or Hold?
  • After all the calculations and research, even
    though Walgreen has been performing well,
    analysis shows that the best option is to BUY the
    stock.
  • Based on statistical reports, Our Group would
    recommend to buy and then HOLD the stock

32
Thank You for Your Time!
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