Boston, MA 04/10/2014 (wallstreetpr) – Walgreen Company (NYSE:WAG) is a $63 billion organization which operates retail drugstores. The company lost its growth momentum in 2012 following disputes with Express Scripts Holding Company (NASDAQ:ESRX). However, positive growth momentum can be seen returning and holding up nicely in the drugstore.
According to the latest sales data, Walgreen managed to sustain growth momentum during the month of March. Sales grew 4.5 percent annually in March to $6.43 billion. That signaled a strong reacceleration in top line growth since the troubles of 2012. In September 2012, the company resolved its issues with ESRX, a provider of pharmacy benefits management, and sales have been accelerating. Sustained growth in sales is an indication that the company is winning the competition war with its ongoing restructuring.
More stores
Walgreen Company (NYSE:WAG) believes it can achieve more growth by focusing on opening of more stores in strategic market locations. The company is also currently observing a more disciplined costs and expenses control measures to ensure that growth in top line trickles to the bottom line.
As of the end of March, the retail drugstore operator had more than 8,688 store locations in the U.S. The company plans for up to 75 new stores in the current fiscal year. In expanding store locations, the company seems keen to take advantage of the opportunity arising from the Affordable Care Act which brings insurance to more Americans. Moreover, the company expects to benefit from the aging U.S. population as spending on drugs is expected to go up.
Positive growth indicators
For retailers, the performance of comparable stores provides a key indicator for future growth. As for Walgreen Company (NYSE:WAG), comparable store sales have been increasing and in March, comp sales increased by 8 percent.
To sum up the story
That sales are holding up nicely at Walgreen Company (NYSE:WAG) is good news for investors. It means that the company will be able to return more money to investors through higher dividends and stock repurchase. The company just announced quarterly dividend payment of 32 cents, same as the previous dividend amount.
