Albertsons to Buy Remnants of Rite Aid Following Walgreens Deal
20 February, 2018, 21:04
Under the deal, most of Albertsons Cos.' grocery-store pharmacies will be rebranded as Rite Aid (NYSE: RAD), while the company continues to operate Rite Aid stand-alone locations.
The drugstore chain and Albertsons have a combined value of around $24 billion, including debt, the companies said Monday.
Rite Aid rose 23% before U.S. markets opened on Tuesday. "Estimates have been stable lately". "Walmart, in turn, has boosted its e-commerce offerings and the range of goods it sells, through a number of recent deals".
"Rite Aid, which sells prescription drugs, has been struggling with eroding profits in its pharmacy business as increases in branded drug prices have slowed while reimbursement pressures for generics has intensified", points out Reuters' Shalini Nagarajan. The rating was downgraded by Evercore to "Hold" on Wednesday, January 6. Deutsche Bank started coverage on Rite Aid in a research report on Monday, December 4th. Loop Capital maintained it with "Hold" rating and $2 target in Friday, September 29 report.
For perhaps the second time in his long career, Bob Miller may be a white knight for Rite Aid shareholders.
Among 11 analysts covering Chemical Financial (NASDAQ:CHFC), 8 have Buy rating, 0 Sell and 3 Hold.
At 1230 GMT, Rite Aid shares were up 28% in pre-market trade to $2.73. Rite Aid Co. has a 52-week low of $1.38 and a 52-week high of $6.15. Fort Pitt Capital Group LLC now owns 49,210 shares of the company's stock valued at $145,000 after buying an additional 13,500 shares during the last quarter. State Common Retirement Fund holds 0.01% of its portfolio in Rite Aid Corporation (NYSE:RAD) for 2.28 million shares. Harbor Advisors LLC lifted its position in Rite Aid by 300.0% in the third quarter. Should Kimco decide to monetize its investment in the coming years, consistent with its 2020 Vision, it would expect to utilize proceeds to further reduce leverage, fund future development and redevelopment activity, or buy back shares under the recently authorized stock repurchase program. Finally, PointState Capital LP purchased a new position in shares of Rite Aid during the 2nd quarter valued at $221,000. The firm represents individual and institutional investors in shareholder derivative and securities class action lawsuits.
COPYRIGHT VIOLATION WARNING: "Zacks Investment Research Upgrades Rite Aid (RAD) to Hold" was first reported by Week Herald and is owned by of Week Herald. If you are accessing this piece on another website, it was copied illegally and republished in violation of global trademark and copyright legislation. It also reduced its holding in Graphic Packaging Hldg Co (NYSE:GPK) by 61,500 shares in the quarter, leaving it with 7.20M shares, and cut its stake in Cf Corp.
The companies said the combination is expected to leverage a strong pharmacy network and Rite Aid's PBM, EnvisionRxOptions, to drive significant customer growth.