Play Ball!!!!
The first stock up to bat:
My first stock pick is going to be a little bit of a risky play, but I really think this one will do well over the next eight quarters. Rite Aid's acquisition of 1,858 Brooks and Eckerd stores will benefit Rite Aid in my opinion. According to an analyst at Credit Suisse, Edward Kelly, it will double Rite Aid's pre-tax earnings, "We believe the deal will almost double pre-tax earnings…increase the free cash flow yield to about 3 percent from zero and have almost no impact on the adjusted debt." But on the other hand there are those analyst's who disagree. According to Morgan Stanley analyst Mark Wiltamuth, he believes Rite Aid is still a turnaround story and he says, "As neither has been successful at executing a meaningful store-level turnaround, we expect the market to take "show me" attitude to this transaction." He also says that it is weak and an underperformer compared to its competitors, Walgreens and CVS.
After watching an interview with Ms. Mary F. Sammons, CEO of Rite Aid, I believe in her and her strategies. She says that this acquisition will really have no impact on long-term debt and that this move will only help the struggling Rite Aid continue its turnaround. I believe in this company and so should you. If Ms. Sammons and Rite Aid deliver, this stock could be huge for investors. I rate this one a "buy" with a Price Target of $5.50 over the next 8-10 quarters.
Current Price: $4.80
My first stock pick is going to be a little bit of a risky play, but I really think this one will do well over the next eight quarters. Rite Aid's acquisition of 1,858 Brooks and Eckerd stores will benefit Rite Aid in my opinion. According to an analyst at Credit Suisse, Edward Kelly, it will double Rite Aid's pre-tax earnings, "We believe the deal will almost double pre-tax earnings…increase the free cash flow yield to about 3 percent from zero and have almost no impact on the adjusted debt." But on the other hand there are those analyst's who disagree. According to Morgan Stanley analyst Mark Wiltamuth, he believes Rite Aid is still a turnaround story and he says, "As neither has been successful at executing a meaningful store-level turnaround, we expect the market to take "show me" attitude to this transaction." He also says that it is weak and an underperformer compared to its competitors, Walgreens and CVS.
After watching an interview with Ms. Mary F. Sammons, CEO of Rite Aid, I believe in her and her strategies. She says that this acquisition will really have no impact on long-term debt and that this move will only help the struggling Rite Aid continue its turnaround. I believe in this company and so should you. If Ms. Sammons and Rite Aid deliver, this stock could be huge for investors. I rate this one a "buy" with a Price Target of $5.50 over the next 8-10 quarters.
Current Price: $4.80
posted by Ira at 7:05 AM
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