A Value Stock Investing Tutorial from WAG
Value has always been manna from heaven for stock investing. Value investing is especially popular today. Everyone searches NYSE listings for stocks with more inherent value than current prices suggest. It is easier to converse about value investing than to practice it. Seeing stock value that others cannot needs X-Ray like vision. How can you penetrate stock market barriers to see stocks in proper light? Here is a live example:
The Walgreen Company trades on NYSE under the symbol WAG. The stock has ended February 2008 about 20% below its 52-week high of $49.10. The Price to Free Cash Flow on Trailing Twelve Months Basis has been 572.68 against 38.57 for the industry. Annual sales growth during the Most Recent Quarter has been less than a third of what competitors have achieved. The Net Profit Margin over the past five years is less than 4%. WAG is a member of the Retail (Drugs) Industry. The latter is a part of the Services Sector. Why do we think WAG is a value stock? (We have no financial interests in this evaluation).
WAG fills prescriptions through the World Wide Web and on the telephone as well. That does not mean it is involved in illegitimate drug trade: it merely offers great convenience. Even visiting a Walgreen store is a pleasure. The company has nearly six thousand of them all over the United States and Puerto Rico. You can buy candy, greeting cards, and a host of other fun things, while your prescription is put into containers. WAG cannot cure you, but it makes being unwell a little easier.
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