Walgreen First Quarter Earnings Sneak Peek

S&P 500 (NYSE:SPY) component Walgreen (NYSE:WAG) will unveil its latest earnings on Friday, December 21, 2012. Walgreen operates a chain of retail drug stores.

Walgreen Earnings Preview Cheat Sheet

Wall St. Earnings Expectations: The average analyst estimate is for net income of 67 cents per share, a rise of 6.3% from the company’s actual earnings for the year-ago quarter. The average estimate is the same as three months ago. Between one and three months ago, the average estimate moved up. It has dropped from 70 cents during the last month. For the year, analysts are projecting profit of $3.21 per share, a rise of 18.5% from last year.

Past Earnings Performance: The company fell short of estimates last quarter after being in line with forecasts the quarter prior. In the fourth quarter of the last fiscal year, it reported net income of 52 cents per share versus a mean estimate of 55 cents. Two quarters ago, it reported profit of 62 cents per share.

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A Look Back: In the fourth quarter of the last fiscal year, profit fell 55.4% to $353 million (39 cents a share) from $792 million (87 cents a share) the year earlier, missing analyst expectations. Revenue fell 5% to $17.07 billion from $17.97 billion.

Balance Sheet Analysis: The company’s current ratio of assets to liabilities came in at 1.23 last quarter. The current ratio is an indication of a firm’s liquidity and ability to meet creditor demands and generally, for every dollar the company owes in the short term, it has that figure available in assets that can be converted to cash in the short term. The company regressed in this liquidity measure from 1.54 in the third quarter of the last fiscal year to the last quarter driven in part by an increase in liabilities. Current liabilities increased 16.3% to $8.72 billion while assets decreased 7% to $10.76 billion.

Wall St. Revenue Expectations: On average, analysts predict $17.5 billion in revenue this quarter, a decline of 3.6% from the year-ago quarter. Analysts are forecasting total revenue of $73.74 billion for the year, a rise of 2.9% from last year’s revenue of $71.63 billion.

Key Stats:

On the top line, the company is hoping to use this earnings announcement to snap a string of two-straight quarters of revenue declines. Revenue fell 3.4% in the third quarter of the last fiscal year and dropped again in the fourth quarter of the last fiscal year of the last fiscal year.

The company is trying to stem some negative momentum heading into this earnings announcement. Profit has dropped by a year-over-year average of 19.6% over the past four quarters.

Analyst Ratings: There are mostly holds on the stock with nine of 17 analysts surveyed giving that rating.

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(Company fundamentals by Xignite Financials. Earnings estimates provided by Zacks)