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Walgreens Boots Alliance Inc. (NASDAQ: WBA) is scheduled to release its fiscal first-quarter financial results before the markets open on Wednesday. The consensus estimates are calling for $1.41 in earnings per share (EPS) and $34.58 billion in revenue. The same period of last year reportedly had $1.46 in EPS and $33.79 billion in revenue.

Merrill Lynch’s Michael Cherny and Allen Lutz recently issued a report noting that are still many hurdles to a potential buyout, go-private or merger deal for Walgreens. The Merrill Lynch team noted “many” hurdles to completing this hypothetical deal. Walgreens continues to have a number of operational issues. These come with questions about potential exit values and returns assumed for the deal. Other issues come from general reimbursement pressure, deflation in the pharmaceutical segment from generic competition and even slower sales from the retail portion of the drug-store chain due to e-commerce. The team even said that a number of operating expense reductions are already factored into the firm’s own financial estimates.

As for a standalone value, Merrill Lynch maintained its Underperform rating and $50 price objective. The firm did caution that headlines could create ongoing volatility, implying that deal talk reports could move the shares up or down depending on the implications.

AmerisourceBergen comes into play on this because there have been press reports in the past that the drug wholesaler potentially could be acquired by the pharmacy giant. After all, Walgreens already owns about 27% of AmerisourceBergen. Merrill Lynch also pointed out that there are problems with considering that for M&A. Merrill Lynch has only an $83 price objective, and it remains handily under the average target price from other analysts. Its report said:

With or without a potential WBA deal, we think the premium in AmerisourceBergen shares for a hypothetical sale to WBA is unwarranted. The other corollary is CVS, which is WBA’s biggest competitor and is heavily investing in its new service model. If WBA were going to go even further into cost rationalization efforts, it could provide share gain opportunities for CVS going forward.

Overall, Walgreens has underperformed the broad markets, with its stock down 12% in the past 52 weeks. In the past quarter, shares are actually up 12%.

A few other analysts weighed in on Walgreens ahead of the report:

• Wells Fargo has an Equal-Weight rating.
• SunTrust Banks has a Hold rating and a $60 price target.
• Pivotal Research has a Hold rating with a $55 price target.
• JPMorgan’s Neutral rating comes with a $63 target price.

Shares of Walgreens traded down less than 1% Monday at $58.65, in a 52-week range of $49.03 to $74.94. The consensus price target is $57.11.