Jefferies Reiterates Buy Rating on Walgreen Co. (WAG)

Jefferies & Company is out with a research report this morning, where it reiterates its Buy rating on Walgreen Co. WAG; it has a $45.00 price target on the stock. The Jefferies analysts noted that WAG would report earnings on Wednesday, which they believe will be positive, highlighted by 30 basis points of improved gross margin. The analysts added that they are looking for continues confirmation that cost controls on the core business remain intact. As for valuation the DB analysts remarked, “Our PT of $45 represents ~15x our FY12 estimate, a discount to its average 1 year forward P/E over the last 5 years. Moreover, with a DCF that returns an intrinsic value of about $60, there remains considerable value in the company's shares.”