Fred's, Inc. (NASDAQ:FRED) Agrees to Buy 865 Rite Aid Stores

Fred's, Inc. (NASDAQ:FRED) Agrees to Buy 865 Rite Aid Stores

(NASDAQ:FRED) were up 87.3% as of 2:15 p.m. EST Tuesday after the drugstore chain agreed to acquire 865 Rite Aid (NYSE:RAD) stores.

Grimes & Company Inc. increased its stake in shares of Rite Aid 36.8% in the second quarter. The Stock now has a Weekly Volatility of 2.21% and Monthly Volatility of 1.87%. Looking ahead, analysts on average predict that earnings for the current quarter would come in in the range of $0.97 to $1.01. 1 given Buy rating to the stock whereas 1 analyst given UNDERPERFORM rating to stock and 5 analysts given HOLD rating. Walgreens Boots Alliance Inc has a five bull (top rated) technical rating because it's trading above its 10-, 50-and 200- day simple moving averages and the stock is up 0.37% on the day the day. About 52.73 million shares traded hands or 265.17% up from the average.

According to sentiments of 4 analysts the mean estimates of short term price target for the company's stock is marked at $8.69.

Although Fred's had been considered to be possible buyer for some of the stores Walgreens and Rite Aid would have to spin off, that Walgreens plans for it to be the sole buyer of so many stores caught the market off guard. (NASDAQ:CSCO) [Trend Analysis] swings enthusiastically in regular trading session, it a decrease of -0.25% to close at $30.49.

However, one expert predicted that up to 3,000 stores may close before and after the deal anyway, due to the number of locations with Walgreens and Rite Aid stores close to each other. Rite Aid Corp. has a one year low of $6.33 and a one year high of $8.69.

Wells Fargo analysts provided their view on Walgreens Boots Alliance, Inc. The firm has a market capitalization of $93.25 billion, a price-to-earnings ratio of 22.53 and a beta of 1.19.

The company's price to free cash flow for trailing twelve months is 155.55.

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The 21 analysts offering 12-month price forecasts for Walgreen have a median target of 95.00, with a high estimate of 100.00 and a low estimate of 70.00. Bank of America initiated the stock with "Buy" rating in Thursday, August 13 report. In comparison, the consensus recommendation 60 days ago was at 2.53, and 90 days ago was at 2.53 respectively. In connection with this transaction, the Company has received financing commitments to fund the purchase price, transaction-related costs, ongoing business operations and anticipated capital investments.