Why Did Walgreens Stock Rise 20%?

In the United States, Walgreens reported its fourth-quarter fiscal 2024 results, showcasing strong financial performance. The company achieved revenue of $37.5 billion, which surpassed analysts' expectations of $34.9 billion, indicating a 6% year-over-year growth driven largely by its U.S. Retail Pharmacy operations. Adjusted earnings reached $0.39 per share, slightly above projections, while fiscal 2025 outlook estimates aligned with consensus, promoting investor confidence. Walgreens’ U.S. Retail Pharmacy segment grew 6.5% to $29.5 billion, with international sales also increasing by 3.2% to $6.0 billion. The U.S. Healthcare business recorded a notable 7.1% rise, bringing in $2.1 billion. Despite these gains, adjusted earnings per share were lower compared to the previous year’s $0.67, reflecting ongoing challenges in the sector. Looking ahead, Walgreens forecasts total sales for its next fiscal year to be between $147 and $151 billion and expects adjusted earnings between $1.40 and $1.80, which reassures analysts and investors alike. The announcement of closing 500 stores in 2025 is anticipated to streamline operations and enhance the company’s overall margin profile. Ultimately, the stock surged over 20% following the report, reflecting optimism about the company’s growth trajectory, though the stock's long-term performance remains inconsistent compared to market averages.