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Published on 2 Dec 2021 on Zacks via Yahoo Finance

Walgreens Boots (WBA) Faces Margin Pressure, Solvency Issue


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Walgreens Boots Alliance, Inc. WBA has been reeling under the effects of persistent reimbursement pressure and a competitive market. The stock carries a Zacks Rank #4 (Sell).

Year to date, Walgreens Boots has underperformed the industry. The stock has gained 12.3% compared with the industry’s 27.1% rise. A shift in the mix of pharmacy prescription volume toward programs offering lower reimbursement rates might affect Walgreens Boots’ results of operations. The company’s 90-day retail offering for patients with chronic prescription needs typically is at a lower margin than comparable 30-day prescriptions.

In the last few years, a slowdown in generic introduction has been affecting Walgreens Boots’ margins. In addition, of late, increased reimbursement pressure and generic drug cost inflation have been hampering Walgreens Boots' margin significantly.

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