Walgreens Financial Statements and Financial Ratios Analyzed

Walgreens Financial Statements and Financial Ratios Analyzed

A Beginner's Guide to Walgreens Financial Analysis - 2021

  • Included Easy to download PDF File.
  • Included Easy to use format.
  • Included Amazon's Summarized Income Statement and Balance Sheet
  • Included Popular financial ratios for included... With calculations and formulas!
  • Included Expert tips to help with financial statements analysis.
  • Included Expert tips to help with financial ratios analysis.
  • NOT Included-Identify and discuss financial trends.
  • NOT Included-Expert financial analysis done by Paul Borosky, MBA.
  • NOT Included- Analyst "Letter Grades" for Amazon's ratios.

Walgreens Financial Report by Paul Borosky, MBA. - 2019

  • Included Easy to download PDF File.
  • Included Easy to use format.
  • Included Summarized Income Statement and Balance Sheet
  • Included Popular financial ratios included... With calculations and formulas!
  • Included Expert tips to help with financial statements analysis.
  • Included Expert tips to help with financial ratios analysis.
  • Included Identify and discuss financial trends.
  • Included Expert financial analysis done by Paul Borosky MBA.
  • Included Analyst "Letter Grades" for Amazon's ratios.

Hey All,

Thanks for visiting my Walgreens Financial Report page. On this page, you will be able to find preliminary information about Walgreens current financial performance as well as some historical track records and trends. 

For a more detailed examination of Walgreens financial performance, please check out the "Financial Report".  In this report, written by myself, Paul Borosky, MBA., Doctoral Candidate, and published author, you will find:

  • Summarized income statement for the last 5 years.
  • Summarized balance sheet for the last 5 years.
  • Summary analysis by myself of important income statement, balance sheet, and financial ratio trends and other happenings.
  • Five year’s worth of over twenty common financial ratios presented with formulas, calculations, and analysis tips for each ratio.
  • Line by line description, explanation, and analysis tip for most financial statement line items and financial ratios.
  • Professional financial analysis tips provided in each section to help YOU conduct your OWN financial analysis!
  • Each section includes an “in other words” segment.  This is were I use plain English to explain concepts.

Enjoy the preliminary information and for a more detailed analysis, buy the financial report!

Sincerely,

Paul, MBA.

Walgreens 2021 Beginner's Guide to Financial Analysis

Walgreens 2021 - A Beginner's Guide to Financial Analysis by Paul Borosky, MBA.

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Sample Financial Report

Sample Financial Report by Paul Borosky, MBA.
Financial Report Sample 2

Brief Summary: Walgreens Boots Alliance, INC. (WBA)

The Walgreens Boots Alliance Inc., or simply Walgreens (WBA), as their headquarters in Deerfield, Illinois.  The organization competes in the healthcare sector.  Specifically, the pharmaceutical retail industry.  At present, Walgreens employs about 230,000 individuals based on Yahoo finance provided information.

Financially speaking, the organization maintains a $35.1 billion market.  Yahoo Finance reports that Walgreens has a beta of .55.  This indicates that the company is less risky as compared to the overall market.  However, based on their slide in stock price, I would say the company is almost negatively correlated to the market.  In the last 52 weeks, Walgreens stock has fluctuated between $36.65 to $64.50.  The company does pay dividends.  Walgreens dividend yield the last 12 months was 4.64%.  The next dividend payout date is in August.

Walgreens Financial Report Sources

“Walgreens 2019 Company Analysis… For Beginners: Financial Statements and Financial Ratios: Defined, Discussed, and Analyzed for 5 Years” was written by, Paul Borosky, MBA. and owner of Quality Business Plan.  In this report, I used Walgreens 2018 10k, 2017 10k annual report, 2016 10k annual report, 2015 10k annual report, and 2019 10k annual report as the basis for information gathering. 

 

Section 1: Walgreens Income Statement Analyzed

In this section, I walk through a broad definition as to what an income statement is and why it is important.  From this, I then discuss and define income statement line items, such as revenues, gross profits, etc. in detail.  After each line item is defined and discussed, I finally offer a summary analysis of Walgreens important income statement line item trends from 2015 to 2019, in most cases.

Walgreens Inc. Revenue Growth.

Walgreens had revenues of approximately $103 billion in 2015.  The next two years, the company would moderately increase the revenues in the 2017 with about $118 billion.  However, in the last two years, ending in 2019, the firm would substantially increase the revenues ending 2019 with revenues of approximately $136.8 billion.  Surprisingly though, the organizations net profits have actually decreased as compared to the revenues.  This is more than a little bit concerning from an investor’s perspective.

Walgreens 2021 Summary Income Statement

Column1 2021 2020 2019 2018 2017
Revenues                  132,509                  121,982                  120,074                  131,537                    118,214
COGS                  104,442                    95,905                    91,915                  100,745                      89,052
Gross Profit                    28,067                    26,077                    28,159                    30,792                      29,162
 
SG&A                    24,586                    25,436                    23,557                    24,694                      23,813
Depreciation                      1,973                      1,927                      2,038                      1,770                        1,654
R & D
Other
Total Operating Expenses                    25,725                    25,095                    23,393                    24,503                      23,677
EBIT                      2,342                         982                      4,766                      6,289                        5,485
Other Income
Interest Expense                         905                         613                         650                         616                           693
EBT                      1,995                         446                      4,359                      5,975                        4,853
Taxes                         667                         339                         577                         998                           760
Net Income                     2,542                        424                     3,962                     5,031                      4,101

Section 2: Walgreens Balance Sheet Analyzed

For Walgreens balance sheet, I again go through each important line item from the balance sheet.  In reviewing each line item, I will define their balance sheet line item, such as cash, property, plant and equipment, and liabilities between 2015 to 2019.  Next, I then offer a summary analysis of their important balance sheet line items.

Walgreens Inc. Cash.

Walgreens Inc. ended 2019 with approximately $3 billion with cash on hand.  In the next year, Walgreens would substantially increase their cash position and in 2016 with about $9.8 billion in the bank.  However, the organization would then continually drop in their cash position ending 2019 with $1 billion in the bank.  The substantial reduction in cash may be due to an acquisition.  Also, the company may have taken out significant debt in 2016, which drove up their cash position.

Walgreens 2021 Summary Balance Sheet

Column1 2021 2020 2019 2018 2017
Cash                        1,193                       469                    1,023                       785                    3,301
Short Term Investment
Account Receivable                        5,663                    4,110                    7,226                    6,573                    6,528
Inventory                        8,159                    7,917                    9,333                    9,565                    8,899
Other
Current Assets                    15,814                18,073                18,700                17,846                19,753
Net PPE                      12,247                  12,796                  13,478                  13,911                  13,642
Goodwill                      12,421                  12,013                  16,560                  16,914                  15,632
Other
Total Assets                    81,285                87,174                67,598                68,124                66,009
 
Accounts Payable                      11,136                  10,145                  14,341                  13,566                  12,494
Accrued Expense                        7,260                    5,861                    5,474                    5,862                    5,473
Accrued Taxes                             94                         95                       216                       273                       329
Notes Payable                        1,305                       325                    5,738                    1,966                       251
LT Debt - Current
Other
Total Current Liabilities                      22,054                  27,070                  25,769                  21,667                  18,547
 
LT Debt                        7,675                  12,203                  11,098                  12,431                  12,684
Other
Total Liabilities                    57,145                66,038                43,446                41,435                37,735
 
Common Stock                      11,000                  10,773                  10,651                  10,505                  10,351
Treasury                      20,593                  20,575                  19,057                  15,047                    9,971
Retained Earnings                      35,121                  34,210                  35,815                  33,551                  30,137
Other
Total Equity                    23,822                21,136                24,152                26,689                28,274
Total Equity & Liability                    81,285                87,174                67,598                68,124                66,009

Section 3: Walgreens Financial Ratios Analyzed

For this section, I have chosen several different financial ratios to review for Walgreens from 2015 to 2019.  In reviewing each of their financial ratios, I first start with defining the financial ratio.  Next, I supply the financial formula for calculating the specific ratio.  Finally, I offer a brief analysis of their important Financial ratios. 

Walgreens Inc. Current Ratio.

In 2015, Walgreens had a current ratio of approximately 1.19.  Because the company does deal with retail, the organization should employ a lower current ratio as compared to other industries.  For example, Walmart continuously has a current ratio well below 1.0.  This is because these types of organizations continually generate cash on a daily basis.  This enables the firm to optimize its current assets at a higher rate as compared to other industries.  In my most humble of opinion, Walgreens needs to employ similar strategies as compared to other retail industry competitors.

Walgreens Inc. Total Asset Turnover.

Walgreen's total asset turnover ended 2015 at 1.50.  In the next four years, Walgreens will continually improve their total asset turnover ending 2019 with 2.02.  This indicates that Walgreens management teams are taking steps to continually increase their total asset utilization.  Also, the firm may be liquidating underperforming assets to help improve this ratio on a continuous basis.

Walgreens Inc. Return on Assets.

Walgreen's return on assets ended 2015 at 6.22%.  In the next four years, Walgreens would fluctuate between 7.39% in 2018 to 5.77% in 2016.  The significant fluctuation of return on assets shows that the organization does not have a coherent strategy to continually improve and optimize the usage of assets from the perspective of revenue generation.  To improve on this ratio, the organization may wish to close down underperforming stores or take action to improve inventory holding practices.

Walgreens Inc. Debt ratio.

Walgreens ended 2015 with the debt ratio of 19.36%.  In the next year, the organization’s debt would climb to 25.73%.  Fortunately though, the last three years, Walgreens has taken significant steps to reduce their current debt ratio.  The steps resulted in a debt ratio of 16.42% in 2019.  In my opinion, this debt ratio may be an optimal level for the organization.  Going any lower may jeopardize the company’s ability to exploit right off opportunities for interest payments.  Also, additional funds that may be paid to paying down the debt could be used for expansion purposes.

Walgreens 2019 Liquidity Ratios

Ratios 2019 2018 2017 2016 2015
Current Ratio                           0.73                    0.82
Cash Ratio                           0.04                    0.04
Quick Ratio                           0.36                    0.38
Net Working Capital                       (2,449)                (2,778)

Walgreens 2019 Asset Utilization

Ratios 2019 2018 2017 2016 2015
Total Asset Turnover                           2.02                    1.93
Fixed Asset Turnover                         10.15                    9.46
Days Sales Outstanding                         19.27                  18.24
Inventory Turnover                         14.66                  13.75
Accounts Receivable Turnover                         18.94                  20.01
Working Capital Turnover                       (55.89)                (47.35)
AP Turnover                           9.54                    9.70
Average Days Inventory                         31.90                  34.65
Average Days Payable                         49.02                  49.15
Cash Conversion Cycle                           2.15                    3.74

Walgreens 2019 Profitability Ratios

Ratios 2019 2018 2017 2016 2015
Return on Assets 5.86% 7.39%
Return on Equity 16.40% 18.85%
Net Profit Margin 2.89% 3.82%
Gross Profit Margin 21.97% 23.41%
Operating Profit Margin 3.65% 4.78%
Basic Earning Power 7.39% 9.23%
ROCE 11.95% 13.54%
Capital Employed                       41,829                46,457
ROIC 39.43% 47.05%

Walgreens 2019 Long-term Debt

Ratios 2019 2018 2017 2016 2015
Debt Ratio 16.42% 18.25%
Debt/Equity 45.95% 46.58%
Times Interest Earned                           7.10                  10.21