Walgreens stock is down over 65% in 2024 and has been in a downturn for over four years
Shares of Walgreens Boots Alliance Inc (NASDAQ:WBA) are up 0.8% to trade at $8.99 this afternoon, brushing off this morning's price-target cut to $11 from $13 at Deutsche Bank. Wall Street is gearing up for the company's fourth-quarter report, due out before the bell on Tuesday, Oct. 15. Below we'll take a look at the company's post-earnings performance history, as well as a few technical set ups that could indicate potential stock movement.
Over the past two years, WBA has tended to move higher after earnings, finishing five of its eight next-day sessions higher, with an average move of 7.6%. A major exception was in June, when the stock plunged 22.2% the following session. This time around, options traders are anticipating a much higher-than-usual post-earnings shift of 18.2%, regardless of direction.
Heading into today, analysts were heavily bearish on WBA, with 14 of the 15 in coverage sporting a "hold" or worse recommendation. That's not a surprise, because to say WBA has struggled on the charts long term would be an understatement
WBA has been in a brutal downturn since 2021, carving a channel of lower lows. In recent months, the 20-day moving average has been resistance overhead, with the drugstore giant currently testing this trendline. In 2024, the stock sports a steep 65% deficit, and will need a big post-earnings pop to get untracked.
Options traders are in luck. WBA's Schaeffer's Volatility Scorecard (SVS) sits at 82 out of 100, meaning it's often exceeded options traders' volatility expectations in the past year.
