NEW YORK ( F.A.S.T. Graphs) -- Anyone vaguely familiar with TheStreet.com knows co-founder Jim Cramer.
While browsing other sites, I happened upon an update of Jim Cramer's show
editor Miriam Metzinger. The article I'm specifically referencing can be
, but the show is also on
. You can see the video
Here's the quote from the original article that caught my attention: "CVS is terrific. After that I like Walgreen."
While I would certainly agree with Cramer in that both are great companies, perhaps you noticed my slight turn of the phrase within the headline. I could describe my reasoning, but I believe that a picture tells a thousand words.
Thus, allow us to view
(CVS - Get Report)
through the lens of the
fundamental analyzer software tool:
In viewing the business results of WAG, one notices a nearly perfect record of increased earnings. Indeed, over the last 15 years Walgreen has been able to grow earnings by almost 13% a year. Aside from a hiccup in 2012, the business has been the essence of consistency. If we move to the Fundamental Underlying Numbers (FUN) Graphs, a quick check of revenue (sale) and common equity, otherwise known as book value, tells a parallel story.
Sales grew from about $15 billion just before the turn of the millennium to $71 billion in the last year, or at an annualized rate of 11.65%. Likewise, book value grew from just under $3 billion to just over $18 billion, or at a compound annual rate of 14.18% over the last decade and a half. Obviously, the future performance is paramount to consider in viewing Walgreen as a potential investment. But if management can demonstrate analogous results in the future then it appears to be a sensible place for further due diligence.
Allow us to now look at CVS with the same characteristics in mind.
Here we see effectively the same graph that was demonstrated by Walgreen. In fact, if one were to quickly glance at both charts I would imagine they could easily be confused -- each had a small earnings misstep of late but has otherwise exhibited model consistency. Moreover, the 12.7% annual operating earnings growth rate for CVS is effectively the same number as Walgreen's 12.8% mark.