What Happened?

Shares of pharmacy chain Walgreens Boots Alliance (NASDAQ: WBA) jumped 7.4% in the morning session after the company agreed to be acquired by Sycamore Partners for $10 billion. The acquisition price represents a roughly 8% premium to the stock's trading price a day before the news was public.

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What The Market Is Telling Us

Walgreens’s shares are very volatile and have had 26 moves greater than 5% over the last year. In that context, today’s move indicates the market considers this news meaningful but not something that would fundamentally change its perception of the business. 

The previous big move we wrote about was 3 days ago when the stock gained 8.1% on the news that The Wall Street Journal reported the company was close to sealing a deal with private equity firm Sycamore Partners to go private. According to sources, the deal valued WBA at $10 billion.

Walgreens is up 23.5% since the beginning of the year, but at $11.35 per share, it is still trading 47.7% below its 52-week high of $21.69 from March 2024. Investors who bought $1,000 worth of Walgreens’s shares 5 years ago would now be looking at an investment worth $234.24.

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