Walgreen Poised to Pummel Sector

NEW YORK (TheStreet) -- Walgreen(WAG Quote) is pegged to pummel its competitors when it reports its fourth-quarter earnings on Tuesday.

Walgreen has fared better than most drugstores amid the recession. While its front-end has been hurting due to a pullback in consumer spending, it has seen a boost in prescription sales.

Two major initiatives, launched within the past year, have helped to propel the company to the top. One, its "Customer-Centric Retailing" program, is designed to helped attract and retain customers, while the company's "Rewiring for Growth" cost-cutting plan is intended to save the company $1 billion by 2011.

Like other drugstores, it is also looking to benefit from the flu season. The increase awareness due to swine flu outbreak, pushed Walgreen to begin offering its seasonal flu shots a month earlier this year.

And last week, the company said it plans to help curb the shortage of liquid Tamiflu by compounding capsules.

TheStreet users (55.9%) said Walgreen is best poised to gain the most market share from flu season, in our online poll last week.

Walgreen has already said its fourth-quarter sales rose about 8%, to $15.72 billion from $14.6 billion a year ago. For the full year, sales grew more than 7% to $63.35 billion, with same-store sales up 2.1%.

Analysts expect the company to earn 39 cents a share on $15.68 billion in revenue.

In August, Walgreen said it signed a deal with Caterpillar(CAT Quote), the world's largest maker of construction and mining equipment, to offer prescription drugs directly to employees starting in 2010.