Last week, drugstore retailer Rite Aid (NYSE:RAD) reported sales results for May and its first quarter. Although its performance wasn't as strong as its competition, it continues to make steady gains.
For the month, Rite Aid increased total sales by 2.2% to $1.7 billion, with same-store sales gaining 1.7%. Pharmacy comps were up 1.9% but were held back by about 6.5% as a result of new generics. The company's growth of quarterly sales was pretty similar to its monthly numbers. Overall sales increased 2.8% to $4.4 billion, while comps gained 2.3%. Once again, the 2.7% climb in pharmacy comps was hampered by a 5.9% negative impact from new generics.
Although Rite Aid is heading in the right direction, it still has a long way to go if it expects to truly compete with big boys Walgreen (NYSE:WAG) and CVS/Caremark (NYSE:CVS), which posted monthly comps gains of 6.4% and 6.2%, respectively. Rite Aid's acquisition of Brooks and Eckerd stores, which was completed last week, will certainly give the company a larger footprint and put its store count at the same level as the other two major drugstore chains. However, it still hasn't been determined whether it will be able to translate that into long-term gains for investors.
In the battle for drugstore supremacy, there's little doubt that Rite Aid is in third place, trailing Walgreen and CVS. However, the fact that Rite Aid can now be mentioned alongside those powerhouses can be considered an achievement in itself.
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Fool contributor Mike Cianciolo welcomes feedback and doesn't own any of the companies in this article. The Fool has a disclosure policy.
