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What: Shares of drugstore chain Rite Aid
So what: Rite Aid frankly surprised investors by reporting a 1.1% increase in total same-store sales with front-end sales rising 2.2% and pharmacy same-store sales inching up by 0.6% on flat revenue. It also reminded us how tough the drugstore environment has been by reporting a drop of 0.9% in year-to-date same-store sales highlighted by a 2% drop in drugstore revenue.
Now what: Those are a lot of numbers to take in, but the only one that should matter here is that very large negative mark in the earnings column. Since purchasing Eckerd in 2006, Rite Aid has struggled under crippling debt and generic competition for many of its drugstore products. It has resulted in contracting revenues and declining margins to the point where I even question its viability as a business. Competitors Walgreen
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