Walgreen Company (WAG): This Drug Store Chain Beats The Rest

For example, consider that the company lost $368 million in fiscal 2012. This was actually a marked improvement from the gigantic $2.9 billion net loss in fiscal 2009. Thankfully, Rite Aid finally turned a profit of $0.12 per diluted share last year, which explains the rising share price.

Stable business and dividend track record make Walgreen the best buy

CVS grew revenue and earnings per share by 15% and 18%, respectively, last year. The company also gave investors a huge dividend increase. At the same time, Walgreen has a much longer history of dividend payments and annual dividend raises. Moreover, while CVS’s yield is still appreciably below the yield on the S&P 500 Index, Walgreen Company (NYSE:WAG) pays nearly 2.6% at recent levels.

Rite Aid is an interesting play, but it’s probably best served for investors interested in turnaround stocks. Rite Aid is certainly not your typical blue chip. The stock exhibits much more volatility than its two rivals, indicative of its shaky underlying financial results, and the company does not pay shareholders a dividend.

As a result, investors interested in the reliable growth of an industry leader, along with a demonstrated track record of rewarding shareholders, should consider Walgreen to be the industry leader and look forward to rising profits and dividends for many years to come.

The article This Drug Store Chain Beats The Rest originally appeared on Fool.com and is written by Robert Ciura.

Robert Ciura has no position in any stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. Robert is a member of The Motley Fool Blog Network — entries represent the personal opinion of the blogger and are not formally edited.

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