No Earnings Cure at Rite Aid (RAD, WMT, CVS, WAG)
Rite Aid Corp. (NYSE: RAD) just can’t seem to get it right. Whatever the strategy is intended to be doing, it needs a real change in the world of a CVS, Walgreen, and Wal-Mart dominance. The drug store chain just…
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The company reported a second-quarter adjust loss of -$0.18 EPS versus Thomson Reuters estimates of -$0.17 EPS. Revenue was also a tad light for the quarter at $6.16 billion, which is under the estimate of $6.21 billion. Meanwhile, comparable store sales fell 1.5% in the second quarter.
But wait, there’s more. The company has lowered its Fiscal-2011 guidance from a loss of -$0.41 to -$0.65 down to a slightly wider loss of -$0.46 to -$0.67. On the sales front, Rite Aid now expects $25.0 to $25.4 billion from a prior range of $25.2 to $25.6 billion.
Unless the company is announcing a whole new management team and a whole new strategy, this is likely to remain a huge conundrum. Rite Ad is a stock which could still double, but it could also ultimately end up on the garbage pile. After years and years, it remains a turnaround which just will not turn around.
JON C. OGG
Contact [email protected] for any questions or corrections.
Jon Ogg has been a financial news analyst since 1997. Mr. Ogg set up one of the first audio squawk box services for traders called TTN, which he sold in 2003. He has previously worked as a licensed broker to some of the top U.S. and E.U. financial institutions, managed capital, and has raised private capital at the seed and venture stage. He has lived in Copenhagen, Denmark, as well as New York and Chicago, and he now lives in Houston, Texas. Jon received a Bachelor of Business Administration in finance at University of Houston in 1992. www.247wallst.com.
