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WBA (Walgreens Boots Alliance) Altman Z-Score : 1.61 (As of Oct. 31, 2024)


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What is Walgreens Boots Alliance Altman Z-Score?

The Altman Z-Score is a model designed to predict the likelihood of a company going bankrupt within the next two years. Created by American finance professor Edward Altman in 1968, the model is specifically designed for publicly traded manufacturing companies with assets greater than $1 million.

Warning Sign:

Altman Z-score of 1.61 is in distress zone. This implies bankruptcy possibility in the next two years.

Walgreens Boots Alliance has a Altman Z-Score of 1.61, indicating it is in Distress Zones. This implies bankrupcy possibility in the next two years.

The zones of discrimination were as such:

When Altman Z-Score <= 1.8, it is in Distress Zones.
When Altman Z-Score >= 3, it is in Safe Zones.
When Altman Z-Score is between 1.8 and 3, it is in Grey Zones.

The historical rank and industry rank for Walgreens Boots Alliance's Altman Z-Score or its related term are showing as below:

WBA' s Altman Z-Score Range Over the Past 10 Years
Min: 1.61   Med: 3   Max: 4.06
Current: 1.61

During the past 13 years, Walgreens Boots Alliance's highest Altman Z-Score was 4.06. The lowest was 1.61. And the median was 3.00.


Walgreens Boots Alliance Altman Z-Score Historical Data

The historical data trend for Walgreens Boots Alliance's Altman Z-Score can be seen below:

* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD.
* For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.

* Premium members only.

Walgreens Boots Alliance Altman Z-Score Chart

Walgreens Boots Alliance Annual Data
Trend Aug15 Aug16 Aug17 Aug18 Aug19 Aug20 Aug21 Aug22 Aug23 Aug24
Altman Z-Score
Get a 7-Day Free Trial Premium Member Only Premium Member Only 2.22 2.72 2.45 1.83 1.61

Walgreens Boots Alliance Quarterly Data
Nov19 Feb20 May20 Aug20 Nov20 Feb21 May21 Aug21 Nov21 Feb22 May22 Aug22 Nov22 Feb23 May23 Aug23 Nov23 Feb24 May24 Aug24
Altman Z-Score Get a 7-Day Free Trial Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only 1.83 1.96 1.66 1.68 1.61

Competitive Comparison of Walgreens Boots Alliance's Altman Z-Score

For the Pharmaceutical Retailers subindustry, Walgreens Boots Alliance's Altman Z-Score, along with its competitors' market caps and Altman Z-Score data, can be viewed below:

* Competitive companies are chosen from companies within the same industry, with headquarter located in same country, with closest market capitalization; x-axis shows the market cap, and y-axis shows the term value; the bigger the dot, the larger the market cap. Note that "N/A" values will not show up in the chart.


Walgreens Boots Alliance's Altman Z-Score Distribution in the Healthcare Providers & Services Industry

For the Healthcare Providers & Services industry and Healthcare sector, Walgreens Boots Alliance's Altman Z-Score distribution charts can be found below:

* The bar in red indicates where Walgreens Boots Alliance's Altman Z-Score falls into.



Walgreens Boots Alliance Altman Z-Score Calculation

Altman Z-Score model is an accurate forecaster of failure up to two years prior to distress. It can be considered the assessment of the distress of industrial corporations.

Walgreens Boots Alliance's Altman Z-Score for today is calculated with this formula:

Z=1.2*X1+1.4*X2+3.3*X3+0.6*X4+1.0*X5
=1.2*-0.1063+1.4*0.2881+3.3*-0.1695+0.6*0.1188+1.0*1.8221
=1.61

* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD.
* For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency. GuruFocus does not calculate Altman Z-Score when X4 or X5 value is 0.

Trailing Twelve Months (TTM) ended in Aug. 2024:
Total Assets was $81,037 Mil.
Total Current Assets was $18,335 Mil.
Total Current Liabilities was $26,953 Mil.
Retained Earnings was $23,348 Mil.
Pre-Tax Income was -998 + 251 + -13114 + -358 = $-14,219 Mil.
Interest Expense was -131 + -113 + -138 + -99 = $-481 Mil.
Revenue was 37547 + 36351 + 37052 + 36707 = $147,657 Mil.
Market Cap (Today) was $8,179 Mil.
Total Liabilities was $68,856 Mil.

* Note that for stock reported semi-annually or annually, GuruFocus uses latest annual data as the TTM data.

X1=Working Capital/Total Assets
=(Total Current Assets - Total Current Liabilities)/Total Assets
=(18335 - 26953)/81037
=-0.1063

X2=Retained Earnings/Total Assets
=23348/81037
=0.2881

X3=Earnings Before Interest and Taxes/Total Assets
=(Pre-Tax Income - Interest Expense)/Total Assets
=(-14219 - -481)/81037
=-0.1695

X4=Market Value Equity/Book Value of Total Liabilities
=Market Cap/Total Liabilities
=8179.279/68856
=0.1188

X5=Revenue/Total Assets
=147657/81037
=1.8221

The zones of discrimination were as such:

Distress Zones - 1.81 < Grey Zones < 2.99 - Safe Zones

Walgreens Boots Alliance has a Altman Z-Score of 1.61 indicating it is in Distress Zones.

Study by Altman found that companies that are in Distress Zone have more than 80% of chances of bankruptcy in two years.


Walgreens Boots Alliance  (NAS:WBA) Altman Z-Score Explanation

X1: The Working Capital/Total Assets (WC/TA) ratio is a measure of the net liquid assets of the firm relative to the total capitalization. Working capital is defined as the difference between current assets and current liabilities. Ordinarily, a firm experiencing consistent operating losses will have shrinking current assets in relation to total assets. Altman found this one proved to be the most valuable liquidity ratio comparing with the current ratio and the quick ratio. This is however the least significant of the five factors.

X2: Retained Earnings/Total Assets: the RE/TA ratio measures the leverage of a firm. Retained earnings is the account which reports the total amount of reinvested earnings and/or losses of a firm over its entire life. Those firms with high RE, relative to TA, have financed their assets through retention of profits and have not utilized as much debt.

X3, Earnings Before Interest and Taxes/Total Assets (EBIT/TA): This ratio is a measure of the true productivity of the firm's assets, independent of any tax or leverage factors. Since a firm's ultimate existence is based on the earning power of its assets, this ratio appears to be particularly appropriate for studies dealing with corporate failure. This ratio continually outperforms other profitability measures, including cash flow.

X4, Market Value of Equity/Book Value of Total Liabilities (MVE/TL): The measure shows how much the firm's assets can decline in value (measured by market value of equity plus debt) before the liabilities exceed the assets and the firm becomes insolvent.

X5, Revenue/Total Assets (S/TA): The capital-turnover ratio is a standard financial ratio illustrating the sales generating ability of the firm's assets.

Read more about Altman Z-Score and the original research.


Be Aware

Altman Z-Score does not apply to financial companies.


Walgreens Boots Alliance Altman Z-Score Related Terms

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Walgreens Boots Alliance Business Description

Address
108 Wilmot Road, Deerfield, IL, USA, 60015
Walgreens Boots Alliance is one of the largest retail pharmacy chains in the US, with over 8,500 locations. Nearly three quarters of Americans live within five miles of a Walgreens location. Roughly two thirds of revenue is generated from prescription drug sales; Walgreens makes up 20% of total prescription revenue in the US. Walgreens also generates sales from retail products (general wellness consumables and its own branded merchandise), European drug wholesale, and healthcare. With more locations incorporating additional services like Health Corner and Village Medical, Walgreens creates an omnichannel experience for patients and positions itself as a one-stop healthcare provider.
Executives
Inderpal S Bhandari director C/O WALGREENS BOOTS ALLIANCE, INC., DEERFIELD IL 60015
Manmohan Mahajan officer: SVP, Global Controller and CAO C/O WALGREENS BOOTS ALLIANCE, INC., 108 WILMOT ROAD, DEERFIELD IL 60015
Nancy M Schlichting director 200 WILMOT ROAD, DEERFIELD IL 60015
Timothy C Wentworth director, officer: Chief Executive Officer C/O EXPRESS SCRIPTS HOLDING COMPANY, ONE EXPRESS WAY, ST. LOUIS MO 63121
Richard P. Gates officer: SVP, Chief Pharmacy Officer C/O WALGREENS BOOTS ALLIANCE, INC., 108 WILMOT ROAD, DEERFIELD IL 60015
Neal J. Sample officer: EVP, Chief Information Officer 200 VESEY STREET, NEW YORK NY 10285
Todd Heckman officer: Interim Global Controller C/O WALGREENS BOOTS ALLIANCE, INC., 108 WILMOT ROAD, DEERFIELD IL 60015
Polen Thomas E Jr director BECTON, DICKINSON AND COMPANY, 1 BECTON DRIVE, FRANKLIN LAKES NJ 07417
John Patrick Driscoll officer: EVP, Pres. U.S. Healthcare C/O WALGREENS BOOTS ALLIANCE, INC., 108 WILMOT ROAD, DEERFIELD IL 60015
Rosalind G Brewer director, officer: CEO C/O MOLSON COORS BREWING COMPANY, 1225 17TH STREET, SUITE 3200, DENVER CO 80202
Kevin M. Ban officer: EVP, Chief Medical Officer C/O WALGREENS BOOTS ALLIANCE, INC., 108 WILMOT ROAD, DEERFIELD IL 60015
Bryan C Hanson director ZIMMER BIOMET HOLDINGS, 345 E. MAIN STREET, WARSAW IN 46580
Henry Lee Cooper officer: EVP, Pres. Walgreens Pharmacy C/O WALGREENS BOOTS ALLIANCE, INC., 108 WILMOT ROAD, DEERFIELD IL 60015
Tracey D Brown officer: SVP, Pres., Walgreens Retail 675 AVENUE OF THE AMERICAS, 6TH FLOOR, NEW YORK NY 10010
Steven J Shulman director 1564 NE EXPRESSWAY, ATTN: BJ PURCELL, ATLANTA GA 30329

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