Patrick Driscoll, an EVP at Walgreens Boots Alliance (WBA), recently bought 5,172 shares. The buy increased his stake by 10 percent, and came to a total cost of $146,984.
That’s the first insider activity since March, when the company CEO bought 10,000 shares, at a price of $339,510. Otherwise, a company director sold shares last year and another vice president exercised a stock option.
In total, company insiders own about 17.2 percent of the drugstore chain.
Shares have been trending lower this year, with the stock down by about one-third of its value. While WBA has been losing money over the past year, largely on reduced demand for covid vaccines, shares are now down to an estimated 6 times forward earnings.
Action to take: Shares may surprise to the upside here after being so heavily beaten down. The company will stabilize to the post-covid era in time, and find other avenues of profitability.
At present, the drop in shares to a 12-year low has caused the dividend to soar to over 6 percent, which could grow in time, although likely not until WBA gets back to being consistently profitable.
For traders, shares may start to trend higher following their drop to extreme lows. The November $32.50 calls, last going for about $0.50, could see high-double-digit returns in the coming months before expiration.
Disclosure: The author of this article has no position in the company mentioned here, but may trade after the next 72 hours. The author receives no compensation from any of the companies mentioned in this article.