Shares of Walgreens Boots Alliance offer an attractive risk-reward to investors as the company transforms into a health care services-focused business, according to Cowen. Analyst Charles Rhyee upgraded the stock to outperform from market perform, saying in a note to clients Tuesday that the market is largely focusing on Walgreens' struggling retail business, which he expects to fall to only 66% of operating income by 2025.
" He expects additional upside from Walgreens' latest health care investments and offerings, including its acquisition of CareCentrix and the addition of Summit Health following its merger with VillageMD . "We see US Healthcare representing 13% of adj. op inc in FY25 up from -2% in FY23. We expect this to accelerate EPS growth from roughly 6-8% in FY23 to 12-13% in FY25," he wrote.