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What Walgreen Company's Earnings Mean for Mutual Fund Investors (WAG)
Shauna O'Brien Dec 23, 2014
Walgreen Company (WAG) posted its first quarter financial results before Tuesday’s opening bell. Here’s what the results mean for mutual fund investors.
Inside the Results
Earnings
The company reported earnings of $809 million, or 85 cents per share, up from $695 million, or 72 cents per share, a year ago. On an adjusted basis, earnings came in at $773 million, or 81 cents per share – above analysts’ view of 75 cents per share.
Revenue
Revenue for the quarter was $19.6 billion, up from $18.3 billion last year, Analysts expected to see revenue $19.48 billion.
Benefiting from Low Competition
Although Walgreen’s valuation is not overly expensive, it is still not a “cheap” stock at 27 × 2015 earnings estimates. The company benefits from low competition, with CVS Health (CVS) as its main competitor. Fund managers considering a stake in WAG will be more likely to add to positions if the stock pulls back.
Mutual Funds to Watch
Investors seeking exposure to WAG may consider a mutual fund investment. The funds below currently hold the highest stakes in the company.
| Symbol | Mutual Fund | Stake |
|---|---|---|
| VTSMX | Vanguard Total Stock Market Index | 1.51% |
| VFINX | Vanguard 500 Index | 1.08% |
| VGHCX | Vanguard Healthcare | 0.91% |
The Bottom Line
By investing in one of the funds above, investors are able to gain exposure to a diverse group of holdings and industries. Investors interested in WAG may also be interested in CVS Health (CVS)
Shares of WAG are up 30% YTD.
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