Where is Walgreens competitive advantage?

Is there a compelling reason for consumers, or investors, to choose the drugstore chain over the competition?

By Motley Fool Investor Beat Mar 27, 2014 3:06PM
Shares of Walgreen Company (WAG) were up earlier this week after the company announced earnings, posting a reasonable but not spectacular quarter.

Profitability fell slightly due to a slower cold and flu season, and the company also experienced some headwinds on its generic drug business, a segment that the company is heavily dependent on. Some 63 percent of the company's sales come from prescription drugs, and of those sales, the generic drugs are more profitable than their big-name counterparts.
More broadly though, Motley Fool analyst Jason Moser discusses in the video below that while he sees the prescription drug business as a stable one in the United States, he doesn't see any particular competitive advantage that Walgreens has, that would bring consumers there instead of to a competitor. People walk by a Walgreens in Boston, Mass., on April 30, 2013 (Photo by Wendy Maeda/The Boston Globe via Getty Images)

He tends to think that consumers will go to the closest pharmacy available to fill prescriptions, rather than seeing Walgreens as a destination that stands out above the crowd.

While the company has made some efforts to differentiate itself, Jason hasn't found them to be extremely compelling. The prescription drug business may generate stable sales, but for him, there are just better investing opportunities available today.

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3Comments
Mar 27, 2014 4:08PM
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This guy has no idea what he is blathering about (burgers are not prescriptions), WAG is up 61% in the last 36 months, what differentiates them from the other Two is service and store locations. The bottom line is Walgreens is the largest retail drugstore in the United States, they are on every corner and the partnership with Alliance Boots(Walgreens owned) now has a Global presence. Boots alone is in more than 25 countries and employs over 108,000 people. Alliance Boots has pharmacy-led health and beauty retail businesses in nine countries and operates more than 3,100 health and beauty retail stores. Major differences between the top three retail drug stores if you are going to have an article or commercial segment about the topic, you may want to do a little research first!
Mar 27, 2014 5:21PM
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I agree Duck.....Long term holder of WAG, one of the best stocks we have ever owned...


Have bought and sold a few times also...At least partials..

Mar 28, 2014 9:38AM
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To answer the Headline question: They are ON every CORNER...!! Like gas stations used to be.
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