Dow Jones Industrial average lagging behind Walgreens Boots Alliance, Inc. (WBA) reports earnings on Thursday, July 9, with Wall Street analysts expecting an earnings per share (EPS) of $1.24 on in the third quarter of 2020 revenue of $34.25 billion. The stock rallied about 15% in two weeks after better-than-expected second-quarter results in April and turned tail, hitting a seven-year low in May. Unfortunately for long-suffering shareholders, the share price has made little progress large that the level of depression over the past seven weeks, raising the odds for even the lowest of the low.
The stock took off in a speculative rally in the fourth quarter of 2019, supported by the announcement of an lbo, with a new private equity firm. Rumours declined after analysts looked at the company of the huge burden of debt, which would need a staggering $ 12 billion in additional equity. The rally turned on a dime to a seven-month high, and there is little to love about the stock since this time, beyond the heavy 4.36% dividend yield.
Walgreens stock has got a bit of love in the first quarter of flight to safety, but the risk of tape since this time, has not favoured the Dow large companies that pay dividends. Walgreens has done his part in the pandemic, the configuration of the space in the car parks for car tests, but these actions may not have benefited from the results of the company. There has also been little to Wall Street news report in the second quarter, with a single upgrade, emphasizing broad apathy.
Walgreens Long-Term Chart (1987 – 2020)
The stock is entered in a powerful up trend after the stock market crash of 1987, the publication of impressive gains, while sharing four times in the month of November 2000 up to $45.75. A two-legged correction found support in the mid$20 for the first quarter of 2003, paving the way for a resumption of the wave which has completed a roundtrip in the state of the high in 2005. The subsequent escape has failed to attract the interest of buyers, producing volatile on both sides of the action on the top of the support, followed by a 2007 study of ventilation.
The decrease is finished at a 10-year low, near $21 in October 2008, while the following rebound the deadlock on six points in 2006, high in 2011. The stock completed the return trip and broke out in 2013, generating a strong but short-term advance which has posted a record high of $94.10 in August 2015. Then, she relaxed in a shallow trading range, breaking of support in 2017 and entering a significant downward trend which has carved a series of lower highs and lower lows in the third quarter of the year 2020.
The first-quarter selloff failed at the’2013 breakout just above$ 50, the establishment of new resistance at that level. However, the continued decline in May, recovery .786 retracement of Fibonacci from 2008 to 2015 of the trend, marking a high odds turning point in the long-term downward trends. The monthly stochastic oscillator crossed in to buy a cycle at the same time, with both of the technical elements to tell market players to watch for the signs of a new upward trend.
Walgreens Short-Term Chart (2017 – 2019)
The balance volume (OBV), the accumulation-distribution indicator reached an all-time high in the year 2019 increased slightly and fell to an 11-month low in the first quarter. Modest buying pressure since that time looks like the bottom fishing, but the share price has not moved, stuck at the declining 50-day exponential moving average (EMA). During this time, the 200-day EMA has fallen across the blue line at $51, reinforcing the resistance at the .618 retracement level. In turn, this investment warns traders that it will buy a point in the mid$50 to brighten up the dreary, long-term technical outlook.
The Bottom Line
Walgreen Boots Alliance stock heads into this week’s earnings report with high levels of Wall Street and investor skepticism following a five-year downtrend which is still in force, despite an exceptionally strong second quarter action in the big landmarks.
Disclosure: The author holds no positions in the aforementioned securities at the time of publication.