Walgreens Boots Alliance Inc. hasn’t hired a new chief executive officer yet, but analysts and investors are already cheering for one with health-care experience to replace former chief Rosalind Brewer.
(Bloomberg) — Walgreens Boots Alliance Inc. hasn’t hired a new chief executive officer yet, but analysts and investors are already cheering for one with health-care experience to replace former chief Rosalind Brewer.
The shares shot up 6.4% Friday, the most in almost a year, after Bloomberg News reported that the drugstore chain was considering Tim Wentworth, a former pharmacy benefits manager CEO, for its top role. The stock was little changed before US markets opened Monday.
“We believe a CEO with a strong managed care and pharmacy benefit background would be a positive development for Walgreens and a promising step toward a potential turnaround,” RBC Capital Markets analyst Ben Hendrix said Sunday in a note, citing Bloomberg’s report from people who asked not to be named discussing private information. “We believe the leadership transition presents an ideal time to level-set expectations.”
Read More: Walgreens Eyes Tim Wentworth, Ex-Cigna Executive, for CEO
A final decision hasn’t been made and Wentworth may not wind up in the job, the people told Bloomberg. Walgreens is expected to report quarterly earnings Oct. 12.
Wentworth was CEO of Express Scripts, a top manager of drug benefits, and led its $53 billion merger with health insurer Cigna Group in 2018. Cigna announced Wentworth’s retirement two years ago and his employment officially ended in February 2022, according to a company filing.
“He’s a very capable executive with a good track record and reputation, and a lot of goodwill with the Street,” Jefferies analyst Brian Tanquilut said Friday in an email. Along with deep knowledge of health care and PBMs, Wentworth has “big company experience that could be useful in the turnaround process for Walgreens.”
Brewer, a longtime retail executive, departed abruptly at the end of August after just 2 1/2 years on the job, and Ginger Graham, the company’s lead independent director, is serving as interim CEO. Brewer tried to use acquisitions and expansion into more dimensions of health care to make Walgreens a bigger player, but the shares lost about half their value during her tenure.
Walgreens said when announcing that Brewer stepped down that it would “search for a successor with deep healthcare experience to lead in today’s dynamic environment.”
“A new CEO with health-care experience could potentially find better ways to leverage the company’s existing products and services and eventually explore new offerings,” John Boylan, an analyst with Edward Jones, said Friday in an email. “This strategy may take time to unfold, as Walgreens focuses on integrating recent acquisitions and paying down debt associated with those acquisitions.”
–With assistance from John Tozzi.
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