Riots at the U.S. Capitol on Wednesday failed to derail the stock market, with the Dow Jones Industrial Average (DJINDICES:^DJI) logging a second strong day in a row on Thursday. The Dow was up 0.87% at 1:05 p.m. EST.

Walgreens Boots Alliance (NASDAQ:WBA) led the charge after reporting quarterly results that easily beat analyst expectations. Meanwhile, shares of Coca-Cola (NYSE:KO) missed out on the rally again on Thursday after a fourth analyst downgrade this week led investors to sell off the stock.

Person shrugging with question mark bag over his head.

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Walgreens surges on earnings beat

Drugstore chain Walgreens impressed investors on Thursday with a fiscal first-quarter report that sailed past analyst expectations. Revenue beat estimates by $1.35 billion and rose 5.7% from the prior-year period to $36.3 billion. Adjusted earnings per share came in at $1.22, down 11.2% year over year but $0.18 higher than analysts were expecting.

The U.S. retail pharmacy segment generated $27.2 billion of revenue during the quarter, up 3.9% despite reduced foot traffic; weak sales of cough, cold, and flu products; lower flu prescriptions; and a drop in new-to-therapy prescriptions. Overall prescriptions were up 2.7% year over year on a comparable-store basis.

The international pharmacy business didn't fare as well, with sales of $2.6 billion down 6.2% year over year. The impacts of COVID-19 were the main reason for the decline. The pharmaceutical wholesale segment grew sales by 18.6% to $7.1 billion.

Walgreens announced on Wednesday that AmerisourceBergen has agreed to acquire the majority of Walgreens' Alliance Healthcare businesses, which includes the pharmaceutical wholesale business. The deal will allow Walgreens to sharpen its focus on the core retail pharmacy business.

Walgreens maintained its outlook for fiscal 2021, saying that the guidance "skewed to opportunity." The company expects low-single-digit growth in adjusted earnings per share. COVID-19 vaccine distribution could help the bottom line for the full year, but this will likely be offset by the negative impacts of COVID-19 restrictions and stepped-up growth investments.

Shares of Walgreens were up about 6.7% by early Thursday afternoon on the earnings beat. The stock is down roughly 22% over the past year.

Coca-Cola downgraded again

A fourth downgrade in as many days for beverage giant Coca-Cola sent the stock lower on Thursday. Analysts have been souring on Coca-Cola due to valuation concerns and COVID-19 impacts; tax problems can now be added to the list.

Barron's reported on Thursday that J.P. Morgan analyst Andrea Teixeira dropped her rating on Coca-Cola stock from "overweight" to "neutral" due to an ongoing tax dispute between the company and the IRS. Teixeira maintained here $50 price target despite the downgrade.

The U.S. Tax Court ruled against Coca-Cola in November in a case related to tax issues between 2007 and 2009. The potential bill for the company could be as much as $3.3 billion for those years, and there's no guarantee the IRS won't go after the company for additional periods.

Teixeira estimates the total tax bill for Coca-Cola could be nearly $10 billion if the IRS applies the same rationale to years after 2009. Teixeira still likes Coca-Cola for the long term and expects it to recover from the pandemic stronger than ever, but the tax issues could derail the stock this year.

Shares of Coca-Cola were down about 1.4% by early Thursday afternoon. The stock has now slumped roughly 8.6% over the past five trading days on a flood of analyst downgrades.

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