Rite Aid (RAD) and Walgreen (WAG) Rise on CVS Caremark (CVS) Tobacco Announcement

NEW YORK (TheStreet) -- Rite Aid  (RAD) and Walgreen (WAG) closed up 2.06% and 3.4%, respectively, at the close of the trading day on Wednesday after CVS Caremark (CVS) announced that it would cease selling cigarettes and tobacco products at its locations.

CVS fell 1.01% to $65.44, down 67 cents from its previous close of $66.11, in the wake of the announcement. It had a volume of 10,092,115, nearly double its average of 5,348,820.

Rite Aid, on the other hand, climbed to $5.45, up 11 cents from its previous close of $5.34, and hit a high of $5.46 for the day, while Walgreen moved up to $57.85, a $1.90 increase from its previous close of $55.95. It, too, traded above its average volume of 5,645,420 with 8,100,587 for the day.

Must Watch: Jim Cramer: How to Play CVS Kicking the Tobacco Habit

TheStreet Ratings team rates RITE AID CORP as a "hold" with a ratings score of C. TheStreet Ratings Team has this to say about their recommendation:

"We rate RITE AID CORP (RAD) a HOLD. The primary factors that have impacted our rating are mixed - some indicating strength, some showing weaknesses, with little evidence to justify the expectation of either a positive or negative performance for this stock relative to most other stocks. The company's strengths can be seen in multiple areas, such as its revenue growth, compelling growth in net income and solid stock price performance. However, as a counter to these strengths, we also find weaknesses including poor profit margins and weak operating cash flow."

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