Sales 5Year Annual Avg. 10.10. 1.00. 30.50. EPS Qtr vs

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Presented
by Bernadette Haddad Ashraful Hoque
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------------ Roxanne Brandy Uzo
Mokolo Justin Miller John Hoang
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Mission Statement

• Walgreens mission is to offer customers the best
  drugstore service in America. We are guided by a
  century-old tradition of fairness, trust and
  honesty as we continue to expand our store base
  and offer career opportunities to a fast-growing
  and diverse group of men and women. Our goal is
  to develop people who treat customers - and each
  other - with respect and dignity. We will support
  these efforts with the most innovative retail
  thinking, services and technology. The success we
  achieve will allow us to reinvest in our future
  and build long-term financial security for our
  employees and our shareholders.

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Company Strategy

• Enter new markets
• Dense up existing markets
• Relocate
• Remodel
• Invest heavily in high-tech store and
  distribution systems which drive service up and
  costs down
• Offer an online drugstore web site, integrated
  with retail stores.

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History

• In 1901, Charles R. Walgreen Sr. purchased the
  Chicago drugstore where the start of the Walgreen
  chain began.
• On October 31, 1997, the Intercom plus was put
  into the pharmacies to speed up the prescription
  filling process.

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History

• In 1981, the first intercom computers were
  installed in five Walgreens pharmacies in Des
  Moines, Iowa. This was the first step towards
  making Walgreens the first drugstore chain to
  connect all its pharmacy department via
  satellite.
• In April 2002, Walgreens became the first
  drugstore chain to offer prescription labels in
  multiple languages chain wide.

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The Exec.s

• DAVID W. BERNAUER - 60  Chairman and Chief
  Executive Officer Walgreen Co.

• JEROME B. KARLIN - 52  Executive Vice President
  - Drug Store Operations  Walgreen Co.

• JEFFREY A. REIN - 62  President and Chief
  Operating Officer Walgreen Co.

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Stock Ownership
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Financial Ratio Analysis

• Growth Rates EXCELLENT

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Financial Ratio Analysis

• Price Ratios EXCELLENT

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Financial Ratio Analysis

• Profit Margins SATISFACTORY

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Financial Ratio Analysis

• Financial Condition EXCELLENT

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Financial Ratio Analysis

• Investment Returns EXCELLENT

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Financial Ratio Analysis

• Management Efficiency EXCELLENT

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Financial Ratios Conclusion

• Based on its Financial Ratios, overall
  Walgreens is performing EXCELLENT

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Industry Charts
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Segment Revenue Chart
Majority of Walgreens revenue comes from
pharmaceutical products. The prescription drugs
holds 63.
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As of April 1, 2005

• Companies Share price 43.71
• Daily Trading Volume 3.559 Million
• Market Capitalization 44.64 Billion

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Holding Period Return

• In 2005, the Mean Target for the Price of Stock
  is expected to reach 45.43. Currently the price
  is 43.71. Therefore, the stock is UNDERPRICED.

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Free Cash Flow to Equity
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Discounted Cash Flow
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Risk Analysis
Beta COV(RWAG,RSP500) VAR(RSP500)
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Ke of Capital Assets
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Weighted Average Cost of Capital
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Capital Structure
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M M Proposition

• NO MODEL

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Market Efficiency

• Company Specific News
• Walgreens announced its partnership with Ovation
  for the Medicare Part D Drug Program

No Form
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Market Efficiency

• Non-Company Specific News
• Federal policy makers raise short term interest
  rates

Weak Form
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5 Year Stock Price

• Between 2001 and 2003 the stock prices had been
  fluctuating. After 2003, the stock prices has
  steadily been increasing and has reached its
  target price of 45.

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Strengths Weaknesses

• Strengths
• Not a family Company
• Low Beta
• Increasing Net Income
• Only has 1 insider ownership
• Debt/Equity is stable
• Consistent Positive Holding Period Return
• Strong Return on Equity

• Weaknesses
• Weak inventory turnover
• Higher Debt than Industry (not significantly
  higher to the extent that it would effect the
  company in a major way)

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Analyst Opinion
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Buy, Sell, or Hold?

• After all the calculations and research, even
  though Walgreen has been performing well,
  analysis shows that the best option is to BUY the
  stock.
• Based on statistical reports, Our Group would
  recommend to buy and then HOLD the stock

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Thank You for Your Time!