Analysts Aren’t So Sure about Rite Aid Stock

Rite Aid’s stock price movement this year

After a disastrous 2017, Rite Aid stock has managed to stay in the green so far this year. The company is up 2.2% YTD (year-to-date). Rite Aid was hit hard by the delay and eventual termination of the Walgreens’s (WBA) merger deal. The revised transaction couldn’t boost the stock price later in the year.

Analysts Aren’t So Sure about Rite Aid Stock

The recent stock price rally

Rite Aid has stayed particularly strong in June. The stock has risen 26% as of June 23. The stock momentum in 2018 has been generally driven by optimism arising from the Albertsons merger announcement and the completion of store sales to Walgreens.

How have competitors performed?

Competitors Walgreens Boots Alliance (WBA) and CVS Health (CVS) are down 7% and 0.4% YTD, respectively. Like Rite Aid, these stocks have delivered strong returns in June. CVS has risen 14%, while WBA is up 8%. WBA’s stock soared a good 5% after the announcement that the company will be included in the Dow 30 starting on June 26. CVS, on the other hand, rose after the company’s announcement it would launch its drug delivery service.

Wall Street recommendations on RAD

The eight Wall Street analysts that cover Rite Aid collectively rate the stock a 3.0 on a scale where one is a “strong buy” and five is a “strong sell.” Walgreens and CVS have better ratings of 2.3 and 2.0, respectively.

Six of the analysts have given a “hold” recommendation for Rite Aid, while the stock as one “buy” and one “hold” recommendation. In comparison, there aren’t any sell recommendations for either Walgreens or Rite Aid.

Investors looking for exposure to Rite Aid through ETFs can consider the First Trust Consumer Staples AlphaDEX Fund (FXG), which invests 2.3% of its portfolio in the company.