NEW YORK (TheStreet) -- Shares of Rite Aid Corp. (RAD) are up 1.29% to $5.48 after the retail drugstore chain announced an agreement with HealthSpot Inc., a healthcare technology company specializing in the integration of telehealth and primary care.
The company aims to provide convenient healthcare services via private, walk-in HealthSpot stations inside select Rite Aid locations.
Rite Aid will pilot the HealthSpot stations in the greater Akron/Canton, Cleveland and Dayton/Springfield markets.
HealthSpot stations will offer customers convenient access to high-quality, medical care from board certified medical providers using high-definition videoconferencing and interactive medical devices, according to the company.
Using the HealthSpot station, customers can be treated for minor and common health conditions, including cold and flu, rashes and skin conditions, eye conditions, earaches and seasonal allergies, the company added.
Separately, 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, good cash flow from operations and growth in earnings per share. However, as a counter to these strengths, we also find weaknesses including relatively poor performance when compared with the S&P 500 during the past year and poor profit margins."
Highlights from the analysis by TheStreet Ratings Team goes as follows:
- RAD's revenue growth has slightly outpaced the industry average of 3.2%. Since the same quarter one year prior, revenues slightly increased by 3.9%. This growth in revenue appears to have trickled down to the company's bottom line, improving the earnings per share.
- RITE AID CORP reported significant earnings per share improvement in the most recent quarter compared to the same quarter a year ago. The company has demonstrated a pattern of positive earnings per share growth over the past two years. We feel that this trend should continue. This trend suggests that the performance of the business is improving. During the past fiscal year, RITE AID CORP increased its bottom line by earning $0.22 versus $0.12 in the prior year. This year, the market expects an improvement in earnings ($0.28 versus $0.22).
- The gross profit margin for RITE AID CORP is currently lower than what is desirable, coming in at 30.60%. Regardless of RAD's low profit margin, it has managed to increase from the same period last year. Despite the mixed results of the gross profit margin, the net profit margin of 1.96% trails the industry average.
- In its most recent trading session, RAD has closed at a price level that was not very different from its closing price of one year earlier. This is probably due to its weak earnings growth as well as other mixed factors. We feel that the combination of its price rise over the last year and its current price-to-earnings ratio relative to its industry tend to reduce its upside potential.
- You can view the full analysis from the report here: RAD Ratings Report