Walgreens Boots Alliance Stock Surges on Reports of Potential Private Sale

Shares of Walgreens Boots Alliance Inc. (WBA) experienced a significant surge on December 10, 2024, following a report by the Wall Street Journal that the company is in talks to sell itself to Sycamore Partners, a private equity firm. The stock rose by 6% at 12:34 p.m. New York time before trading was halted.

The potential sale to Sycamore Partners has sparked investor interest, reflecting in the increased trading activity. The bullish sentiment is also evident in the option markets, where call volume for Walgreens Boots has been above normal and directionally bullish. On December 9, 2024, 48,133 calls traded, which is 1.6 times the expected volume, and the implied volatility increased by over 10 points to 65.39%.

Despite the recent optimism, Walgreens Boots Alliance has faced significant financial challenges. The company reported a revenue of $147.66 billion in 2024, a 6.17% increase from the previous year, but also incurred losses of $8.64 billion, a 180.4% increase from 2023.

Analysts have maintained a cautious outlook, with an average rating of “Hold” and a 12-month stock price forecast of $12.58, representing a potential increase of 46.96% from the current price. However, concerns about the company’s high debt levels and the sustainability of its dividend yield remain.