Walgreen Beats on Revenue, Matches Expectations on EPS

Walgreen (NYSE: WAG  ) reported earnings March 27. Here are the numbers you need to know.

The 10-second takeaway
For the quarter ended Feb. 28 (Q2), Walgreen beat slightly on revenues and met expectations on earnings per share.

Compared to the prior-year quarter, revenue expanded slightly and GAAP earnings per share contracted slightly.

Gross margins expanded, operating margins contracted, net margins dropped.

Revenue details
Walgreen notched revenue of $18.65 billion. The 10 analysts polled by S&P Capital IQ predicted revenue of $18.42 billion on the same basis. GAAP reported sales were 0.8% higher than the prior-year quarter's $18.50 billion.

Source: S&P Capital IQ. Quarterly periods. Dollar amounts in millions. Non-GAAP figures may vary to maintain comparability with estimates.

EPS details
EPS came in at $0.78. The 22 earnings estimates compiled by S&P Capital IQ forecast $0.77 per share. GAAP EPS of $0.78 for Q2 were 2.5% lower than the prior-year quarter's $0.80 per share.

Source: S&P Capital IQ. Quarterly periods. Non-GAAP figures may vary to maintain comparability with estimates.

Margin details
For the quarter, gross margin was 28.9%, 10 basis points better than the prior-year quarter. Operating margin was 5.9%, 70 basis points worse than the prior-year quarter. Net margin was 3.7%, 30 basis points worse than the prior-year quarter.

Looking ahead
Next quarter's average estimate for revenue is $18.04 billion. On the bottom line, the average EPS estimate is $0.63.

Next year's average estimate for revenue is $72.40 billion. The average EPS estimate is $2.63.

Investor sentiment
The stock has a three-star rating (out of five) at Motley Fool CAPS, with 2,075 members out of 2,216 rating the stock outperform, and 141 members rating it underperform. Among 542 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 514 give Walgreen a green thumbs-up, and 28 give it a red thumbs-down.

Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on Walgreen is outperform, with an average price target of $36.60.

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