Walgreens Had Great Quarter, But Buy CVS Stock, Cramer Says

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Walgreens Boots Alliance  (WBA) - Get Report had the right pill for investors when it reported earnings ahead of the opening bell Thursday.

Adjusted earnings per share for the three months ending in September came in better-than-expected at $1.02, though the result marked a 28.7% decline from the prior year. Revenue rose 2.3% to $34.7 billion, exceeding estimates of $34.37 billion.

"Despite uncertainty amid the global COVID-19 pandemic, we are seeing gradual improvement in key U.S. and UK markets and continued strong performance in our wholesale business. I'm also encouraged by the accelerating growth in our e-commerce platforms," CEO Stefano Pessina said in a statement.

Comparable U.S. store sales for the group's retail pharmacy business rose 3.6%, Walgreen said, with total revenues also up 3.6% to $27 billion.

Sending the stock higher premarket, however, was a positive forecast for the future. "I continue to be inspired by the tireless efforts of our teams as they support and care for our customers, patients and communities, while accelerating progress on our clear set of strategic priorities. Looking ahead, we are projecting adjusted EPS growth in fiscal 2021, as reflected in our new guidance," Pessina said.

Walgreens expects adjusted profits for 2021 to grow in the "low single-digit” percentage range.

Jim Cramer said Walgreens had a great quarter, but CVS is the name he would buy. 

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