Shares down 9%
I'm perplexed that markets put so much more emphasis on yesterday's strong ISM manufacturing report than they did on weak retail sales. Consumers are a vastly larger portion of the US economy and plagued by uncertainty at the moment.
A fresh sign of worry came in today's quarterly report from Walgreens Boots Alliance. The company is the US's largest standalone drugstore chair. The company makes most of its money on dispensing drugs and there are all of the healthcare-related quirks on that front but there are also troubling signs on the consumer. Same-store retail sales were down 3.8% compared to a year ago.
CEO Stefano Pessina called it "the most difficult qwuarter we have had since the formation of Wallgreens Boots Alliance." The company cut its guidance and now sees flat earnings compared to 7-12% growth earlier.
Goldman Sachs called the earnings "alarmingly low" and Evercore ISI said it was a "terrible print" that will hurt the supply chain.
The company is pledging to cut costs.
Is this a preview of what's to come?
Update: Shares now down 12%..