The Power Gauge Spotted This 'Value Trap' Long Ago

One of the biggest pharmacies in the U.S. is in a rough spot... You might have heard it in the news already. Walgreens Boots Alliance (WBA) is struggling. [Chaikin PowerFeed]( The Power Gauge Spotted This 'Value Trap' Long Ago By Vic Lederman, editorial director, Chaikin Analytics One of the biggest pharmacies in the U.S. is in a rough spot... You might have heard it in the news already. Walgreens Boots Alliance (WBA) is struggling. Just this past Thursday, Walgreens released disappointing third-quarter earnings results. And the company announced that it would close a "significant" number of underperforming U.S. stores. Specifically, as Walgreens CEO Tim Wentworth said in the press release... We continue to face a difficult operating environment, including persistent pressures on the U.S. consumer and the impact of recent marketplace dynamics which have eroded pharmacy margins. This is terrible for the company. But the problems aren't new... Walgreens' share price has struggled since 2020. And this year has been particularly challenging. So today, let's take a closer look through the lens of the Power Gauge... Recommended Links: [Here's What You Missed Last Week]( There's a massive shift playing out in U.S. stocks – one we've only seen a dozen times before, going all the way back to 1943... and now one Wall Street veteran is warning it'll impact every major stock you can think of, especially Nvidia. Last week, he shared where the stock market's going next... what it could mean for your money in 2024... and the No. 1 investing strategy he's now recommending if you want to protect and [grow your wealth in 2024](. [A big AI secret in THIS building helps some see 1,000%-plus gains]( It might not look like much, but this building contains an AI secret that's quietly making ordinary folks in this town gains as high as 3,700% and 1,400%. At least 100 locals are poised to become millionaires. Former hedge fund manager Whitney Tilson traveled 300 miles to investigate... [and to reveal how the secret in this building could potentially help you make 10 times your money in the years to come](. Folks, it should be obvious that we don't want to buy stocks in defined downtrends. And there's no question that Walgreens is in a downtrend. Since the beginning of 2020, WBA shares have tumbled about 80%. That's a crushing defeat. But Walgreens is a household name. And by now, there's no question that the stock is "cheap" from a valuation perspective. Heck, Walgreens is trading at a price-to-sales ratio of 0.07. That means for every $1 of sales the company does, Wall Street values it at $0.07. Beyond that, Walgreens is part of a strong industry group in the Power Gauge – Consumer Staples Distribution & Retail. And right now, that industry group is packed with "bullish" stocks. That means there's an economic tailwind pushing the group higher. Put that way, Walgreens' stock might sound appealing. And it's possible this could tempt investors to buy... hoping for a turnaround. Well, the Power Gauge makes it easy to know that it's not time yet. Take a look at this one-year price chart with some data from our system... [Chaikin PowerFeed] We can see some key signals from the Power Gauge... The first is the Chaikin Money Flow indicator. Regular readers know that Chaikin Analytics founder Marc Chaikin invented it back in the 1980s. It's used to track the buying patterns of the so-called "smart money" on Wall Street. As you can see in the first panel below the price chart, Walgreens' Chaikin Money Flow has been sharply negative for most of the past year. And right now, this indicator is rated "very bearish" in the Power Gauge. This means institutional investors haven't been falling for this "value trap." Next, the second panel below the price chart shows Walgreens' relative strength versus the S&P 500 Index. And with this indicator deep in the red, we can see clearly that Walgreens is underperforming the broad market. This year alone, Walgreens has tumbled more than 50%. Meanwhile, the S&P 500 is up nearly 15% so far in 2024. That's severe underperformance. And it's important because it makes it clear that there isn't a hidden turnaround in progress at Walgreens. Lastly, you'll notice that Walgreens has maintained a "bearish" or worse rating in the Power Gauge for most of the past year. And that's the clear signal we need... It means that the Power Gauge has evaluated 20 individual factors driving Walgreens' stock. Taken together, they currently add up to a "bearish" overall rating. Now, Walgreens might be a little too obvious. After all, the stock has been in free fall for years. But have you ever been tempted to buy a stock that seems overly hated? What about buying a stock that felt like an obvious "deal?" The Power Gauge has the tools we need to immediately confirm or reject those ideas. And that's why it's a good idea to check it before putting money to work in a stock... even a household name like Walgreens. Good investing, Vic Lederman --------------------------------------------------------------- Editor's note: P.S. Last week, Marc went on camera to explain how the Power Gauge is signaling a major opportunity in a specific group of stocks right now... In fact, a market signal with 100% perfect historical accuracy is telling Marc it's finally time to share his No. 1 favorite stock strategy. And he expects it to beat the S&P 500 and the "Magnificent Seven" stocks for years to come. If you missed Marc's big reveal, you can still watch a replay with all the details [right here](. Market View Major Indexes and Notable Sectors # Hld: Bullish Neutral Bearish Dow 30 -0.08% 9 16 5 S&P 500 -0.39% 116 304 77 Nasdaq -0.52% 31 55 14 Small Caps +0.42% 488 1009 395 Bonds -1.86% — According to the Chaikin Power Bar, Small Cap stocks and Large Cap stocks are somewhat Bullish. Major indexes are mixed. * * * * Sector Tracker Sector movement over the last 5 days Energy +1.57% Communication +0.85% Discretionary -0.11% Real Estate -0.18% Financial -0.53% Health Care -0.72% Industrials -0.89% Information Technology -0.95% Staples -1.4% Materials -1.48% Utilities -1.8% * * * * Industry Focus Transportation Services 4 20 19 Over the past 6 months, the Transportation subsector (XTN) has underperformed the S&P 500 by -21.70%. Its Power Bar ratio, which measures future potential, is Very Weak, with more Bearish than Bullish stocks. It is currently ranked #20 of 21 subsectors. Indicative Stocks [rating] SAVE Spirit Airlines, Inc [rating] JOBY Joby Aviation, Inc. [rating] FWRD Forward Air Corporat * * * * Top Movers Gainers [rating] SYF +6.69% [rating] CMA +6.69% [rating] DFS +5.72% [rating] MHK +5.13% [rating] UNH +4.69% Losers [rating] NKE -19.98% [rating] FSLR -9.79% [rating] SMCI -7.98% [rating] AES -7.96% [rating] HCA -6.41% * * * * Earnings Report Reporting Today Rating Before Open After Close ACI No earnings reporting today. Earnings Surprises No significant Earnings Surprises in the Russell 3000. * * * * You have received this e-mail as part of your subscription to PowerFeed. If you no longer want to receive e-mails from PowerFeed, [click here](. You’re receiving this e-mail at {EMAIL}. For questions about your account or to speak with customer service, call [+1 (877) 697-6783 (U.S.)](tel:18776976783), 9 a.m. - 5 p.m. Eastern time or e-mail info@chaikinanalytics.com. Please note: The law prohibits us from giving personalized investment advice. © 2024 Chaikin Analytics, LLC. All rights reserved. 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