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Big Drugstores Take Hit in May

Both Walgreen and Rite Aid post May sales that fall below forecasts.



) --




Rite Aid

(RAD) - Get Report

both reported May same-store sales that fell short of expectations.

Walgreen posted a surprise 0.2% drop on Thursday, its second consecutive monthly decline, even as analysts called for a gain of 1.5%.

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The company's numbers were dragged down by its pharmacy division, where sales dropped 0.4%. Still, Walgreen saw an uptick in discretionary purchases, with the front end rising 0.3%. The recent addition of

Duane Reade

stores wasn't included in same-store sales results.

Overall revenue during the month rose 5.9% to $5.7 billion, as Walgreen completed its $623 million buyout of New York-based Duane Reade.

Rite Aid, meanwhile, posted a 1.7% drop in May comparable sales, more than the 1.1% decline Wall Street predicted. Both front-end and pharmacy sales weighed on the company. Front-end sales plunged 3.6%, while pharmacy same-store sales fell 0.8%.

Shares of Rite Aid were slipping 2.2% to $1.15 in Thursday afternoon trades, while Walgreen was off 2.8% to $31.91.

-Reported by Jeanine Poggi in New York.

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