Wall Street Wants Eckerd to Get Healthier
By George Anderson
If you’re running a drugstore chain that doubled your previous year’s profit performance, you’d have reason to celebrate. You would, unless you were the Eckerd drugstore division of J.C. Penney.
Despite a third-quarter that produced $89 million in profits, with profits per share up to 30 cents from the previous year’s 13 cents, many on Wall Street are nervous about Eckerd’s progress.
Shari Schwartzman Eberts, an analyst with JP Morgan Chase told Business Week, “Eckerd’s sales [trends] are lagging its peer group. With the gap widening lately, it looks as if Eckerd may be losing market share in pharmacy sales, which is the traffic driver for the drugstore business.”
Moderator’s Comment: Is Wall Street making too much
of Eckerd’s performance versus Walgreen’s and CVS?
The demographics of an aging population should keep Eckerd’s
pharmacy and front-end business strong for years to come, even if growth is
slower than its two bigger drugstore competitors.
Anderson – Moderator]