Jim Cramer: Rite Aid (RAD) Is Becoming Increasingly Profitable

NEW YORK (TheStreet) -- Shares of Rite Aid Corp  (RAD) were higher by 0.73% to $8.37 in mid-morning trading Monday, after Jim Cramer said the drugstore chain is in the middle of a multi-year turnaround, and is becoming increasingly profitable. He made the remarks on CNBC's Mad Money show Friday.

Cramer said the drugstore chain is in the middle of a multi-year turnaround, and is becoming increasingly profitable.

Rite Aid recently announced it acquired pharmacy benefit manager EnvisionRX for $2 billion.

The new addition will help the pharmacy compete with rivals Walgreens Boots Alliance (WBA) and CVS Health (CVS) in the health care cost containment space.

Cramer added that the EnvisionRX acquisition deal will help Rite-Aid grow even faster while increasing leverage to negotiate better prices for prescription medications.

He believes Rite Aid Has the most upside out of the three drugstore stocks, because shares seem to bounce back from any weakness.

Camp Hill, Penn.-based Rite Aid is a retail drugstore chain that sells prescription drugs and a range of other merchandise throughout the U.S.

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 notable return on equity, revenue growth and compelling growth in net income. However, as a counter to these strengths, we also find weaknesses including generally higher debt management risk, weak operating cash flow and a generally disappointing performance in the stock itself."

If you liked this article you might like

Walgreens Is Primed to Rally, With or Without Rite Aid

S&P 500 and Dow Score Records With Wall Street Upbeat Ahead of Fed

S&P 500 and Dow on Track for Records With Markets in Good Mood Ahead of Fed

Walgreens to Tweak Number of Rite Aid Stores It Buys to Win Regulatory Approval

Will the FTC Let Walgreens Go on a $5.2 Billion Rite Aid Shopping Spree?