(Scott Olson/Getty Images)

Walgreens is the worst performing stock in the S&P 500 this year

Intel. Boeing. Lululemon. Dollar Tree. Paramount. All are having a terrible year, but none are down as much as Walgreens shares.

David Crowther

9/9/24 5:01PM

Updated 9/23/24 10:07AM

Squeezed by the rise of online pharmacies, falling reimbursement rates for prescription drugs, and giants like Amazon eating into their general retail sales, Walgreens investors have had a disappointing year — and nowhere does that show up more clearly than on the ticker tape.

Indeed, Walgreens (WBA) stock has now shed ~64% of its value this year, more than any other in the S&P 500 Index, per data from FactSet. Some shareholders are even suing the company and its management, alleging that they breached their fiduciary duty by inflating Walgreens’ performance projections.

An Rx for Walgreens

So, how does Walgreens turn its ship around? In recent years the company was betting on getting closer to patients, spending more than $5 billion to acquire a majority stake in VillageMD in 2021, as part of an effort to turn its stores into primary-care destinations, as well as just being prescription fillers.

That didn’t really work. Indeed, in June Walgreens announced that it would be cutting its stake in VilageMD, after the company booked an eye-watering $5.8 billion write-down of its value earlier this year. It also said it would begin to dramatically slim its store portfolio, with as many as one-quarter of its 8,600 stores set to close.

But Walgreens’ new CEO, who was appointed last October, doesn’t have the luxury of lots of time on his side. Not just because the company faces a number of headwinds, but because it has billions of dollars of debt.

As of May 31, the company had $703 million of cash and cash equivalents on its balance sheet and $8.9 billion of interest-bearing debt.

But it also has hundreds of leases. These are, primarily, agreements for the stores, warehouses, office space, and distribution centers that it rents. Although they aren’t technically “debt,” they can behave a lot like it. And, once included, the company’s financial position looks very different. Indeed, all told, the company reported having “Lease adjusted net debt” of $29.8 billion at the end of May.

Max Knoblauch26m

Nintendo is reportedly cutting back Switch 2 production by 33% as US sales underperform

Nintendo will produce 4 million units of the Switch 2 this quarter, down one-third from its original 6 million-unit target, according to a report by Bloomberg.

The decision, spurred by weaker-than-expected US holiday sales, is not expected to impact estimates of 20 million Switch 2 unit sales for the fiscal year ending this month.

Nintendo ADRs were down 6% in US premarket trading, and shares closed down nearly 5% in Tokyo. With Tuesday morning’s drop, Nintendo ADRs have entirely shed their gains from the unexpected success of “Pokémon Pokopia.”

Weaker holiday sales weren’t just a Nintendo problem: the season saw the worst November in 30 years for overall American gaming console unit sales, per data from Circana. The Switch 2 rebounded in December, but reports that the company would stop producing its popular (and pricier) “Mario Kart World” bundle dampened investors’ moods again toward the end of the year.

Nintendo Cuts Switch 2 Output by Over 30% on Weak US Sales

Tom Jones22h

Danone acquires meal replacement shake maker Huel for ~$1.2 billion

Very big things are happening today in the world of nutritionally complete products that taste like chalk, as Danone has agreed to buy the celebrity-backed protein bar, powder, meal, and meal replacement shake maker Huel for €1 billion, or around $1.2 billion.

In a statement announcing the acquisition, Danone — apparently the No. 1 yogurt producer in the US and the nation’s top plant-based food and beverage company as well — said that buying Huel will enhance its “presence in functional nutrition and extend its portfolio into the fast-growing Complete Nutrition space.” Danone, the parent company behind Evian and Actimel, also praised Huel’s “best-in-class digital execution” and fan bases across the UK, Europe, and the US.

Bulking season

Huel, a portmanteau of “human” and “fuel,” was only set up just over a decade ago, but thanks to its marketing efforts, a buzzy product range that marries on-the-go eating with nutrient-dense, plant-based ingredients, and a decent list of (mostly UK-based) celebrity investors, like actor Idris Elba and talk show host Jonathan Ross, sales have soared.

Millie Giles

Slow coach

23h

US airlines are still doubling down on premium seats, as the K-shaped economy takes off

There’s really not much room in economy these days.

United Airlines Boeing 787 Dreamliner Flight

Max Knoblauch3/20/26

China’s EV startup trio have all become profitable

China’s EV startup trio, Nio, Li Auto, and XPeng, are now all profitable, following the latter’s Q4 results released Friday.

XPeng reported a quarterly net profit of about $55 million, compared to rival Nio’s Q4 net profit (also its first) of about $40 million. Li Auto posted Q4 net profit of less than $1 million.

All three companies being profitable offers a stark contrast to the EV market in the US, where Rivian quietly delayed its 2027 profitability target in a filing about its Uber robotaxi partnership yesterday. Lucid is likely further away, and last month cut 12% of its US workforce as part of its “path toward profitability.”

Still, it’s not all rosy for China’s EV startups, either. XPeng ADRs were down more than 6% in Friday morning trading as its Q1 sales forecast came in below estimates. As China rolls back subsidies, auto sales are slumping. Chinese retail EV and hybrid sales fell 32% in February from the same month last year.

9.3%

Max Knoblauch3/19/26

As the war with Iran produces the biggest spike in US gas prices since Hurricane Katrina, car retailer CarMax is continuing to see heightened interest in EVs, hybrids, and plug-in hybrids.

“From Feb 1st - March 1st (inclusive), compared to March 2nd to March 15th (inclusive), we saw a 9.3% lift in page views for these vehicles,” a spokesperson for the company told Sherwood News.

As industry insiders recently told us, EV interest climbs when gas prices rise. That appears to be holding true even without EV tax credits, which the Trump administration ended under its new budget package.

CarMax also saw EV searches spike in 2022, amid Russia’s invasion of Ukraine and the resulting oil price spike.