Walgreens Boots Alliance Shines Among Best Medical Stocks Under $20 Amid Healthcare Transformation

The medical industry, a cornerstone of public health and safety, is experiencing a transformative era driven by technological advancements and demographic shifts. Walgreens Boots Alliance, Inc. (NASDAQ: WBA), a multinational health and medical company, has secured a notable position on our list of the best medical stocks under $20. Here’s a closer look at the broader healthcare landscape and where Walgreens Boots Alliance stands in this dynamic industry.


A Booming Healthcare Sector Fueled by Innovation

The global healthcare sector is poised for significant growth, supported by emerging technologies like artificial intelligence (AI). According to Deloitte’s 2024 Global Healthcare Sector Outlook, AI tools are revolutionizing healthcare by improving clinical outcomes, streamlining administrative tasks, and enhancing patient care. These advancements align with the needs of an aging population and rising healthcare costs, setting the stage for substantial industry expansion.

In the United States alone, healthcare spending reached $4.9 trillion in 2023—a 7.5% increase from the previous year—accounting for 17.6% of the economy. Key drivers of this growth include increased private insurance and Medicare expenditures.


Leadership Shifts and Market Sentiment

Amid this growth, leadership changes in U.S. healthcare policy have added an element of uncertainty. Former President Donald Trump nominated Robert F. Kennedy Jr. as Secretary of Health and Human Services, a position responsible for overseeing agencies like the FDA and CDC. Kennedy’s focus on addressing chronic diseases, reducing corruption, and introducing evidence-based practices has sparked mixed reactions.

Wall Street analysts, like JPMorgan’s Chris Schott, note that healthcare stocks are trading at a 35% discount compared to the S&P 500, creating a potential opportunity for investors. Meanwhile, Mizuho’s Jared Holz highlights public health challenges such as obesity and ultra-processed foods, underscoring areas for improvement.

However, Kennedy’s controversial views on vaccines and skepticism about weight-loss drugs have raised concerns about his impact on the healthcare sector.


Walgreens Boots Alliance: Strategic Moves for Growth

Current Share Price (as of January 8): $9.22
Number of Hedge Fund Holders: 33

Walgreens Boots Alliance, Inc. operates through a diverse portfolio of brands, including Walgreens, Boots, and Duane Reade, with approximately 12,500 locations globally. The company is undertaking bold strategic initiatives to optimize its operations and enhance profitability:

  • Cost Management: In fiscal 2024, Walgreens exceeded its cost-saving targets, achieving $1 billion in savings and significant reductions in capital expenditures and working capital.
  • Store Optimization: Walgreens plans to close 1,200 underperforming stores by 2027, with 500 closures slated for fiscal 2025, a move expected to boost earnings per share (EPS) and free cash flow.
  • Product Strategy: The company is redefining its merchandising approach, focusing on expanding its private-label offerings. Over 300 new products were launched in 2024, with plans for another 300 in 2025, particularly in health and wellness.

These initiatives position Walgreens Boots Alliance as a strong contender in the medical stock category under $20.

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