Rite Aid Corporation is a drugstore chain in the United States. The company had its beginnings in 1933 as a small drugstore in Hornell, New York. Rite Aid Corporation has over 2,000 stores across the United States. The company reported sales of $24.
7 billion in 2016. However, Rite Aid stock is trading at just over $2 per share, which has caused the stock to be significantly undervalued.
One reason for the low stock price is that Rite Aid Corporation has been struggling to keep up with the competition. Walgreens Boots Alliance, the largest pharmacy chain in the United States, has been aggressively expanding its presence in the United States.
In 2016, Walgreens Boots Alliance acquired Rite Aid’s former rival, CVS Health Corporation, for $69 billion. This has put additional pressure on Rite Aid to compete and has driven down the stock price.
Another reason for the low stock price is that Rite Aid Corporation has been struggling to generate positive cash flow. The company has been investing in its stores and in its e-commerce operations, but this has not been enough to offset the losses it has been experiencing. In 2016, Rite Aid Corporation reported a net loss of $2.
8 billion. This has caused the stock price to be significantly undervalued.
Given the pressures that Rite Aid Corporation is under, it is likely that the stock price will continue to decline in the near future. However, the company has a lot of potential, and if it can manage to improve its financial performance, the stock may start to regain some of its value.
