Walgreens stock gets a boost after JP Morgan expresses confidence in new CEO

Tim Wentworth officially takes over Walgreens Monday

Shares of Walgreens jumped Monday morning after J.P. Morgan said it was encouraged by new CEO Tim Wentworth's ability to reduce overhangs and boost the pharmacy chain's performance. 

"We believe that today commences a new era for shares of [Walgreens] as Tim Wentworth assumes the CEO role," J.P. Morgan analysts said in a research note led by Lisa Gill. 

Ticker Security Last Change Change %
WBA WALGREENS BOOTS ALLIANCE INC. 18.24 +0.65 +3.70%

Analysts said they are "encouraged by the expertise that Tim Wentworth brings" to the company given his background within healthcare services.

WALGREENS SHARES HAVE BEST DAY SINCE 2022

Wentworth officially steps into his role as CEO on Monday. Earlier this month, he was tapped to lead to the company after heading Cigna’s health services organization Evernorth from 2020 to 2021. 

Walgreens

A pedestrian is reflected in a window of Walgreens in Washington, D.C., on Nov. 2, 2022. (BRENDAN SMIALOWSKI/AFP via Getty Images / Getty Images)

Between 2016 and 2021, he also sat the helm of Express Scripts, which became the largest pharmacy benefit manager in the United States after it merged with Medco Health Solutions, Inc. 

Walgreens Boots Alliance Inc

This background will benefit him in managing the company but also when working with key stakeholders, according to the note. 

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Although the analysts believe that there is "clearly work to be done, with a refreshed healthcare-focused management team and a lowered but credible bar that [Walgreens] has an opportunity to remove several overhangs in the coming quarters and improve performance," the note read. 

Exterior of Walgreens store

Exterior of a Walgreens store. (Walgreens via Business Wire / AP Images)

The combination of Wentworth and John Driscoll, who oversees healthcare for Walgreens, "should enable the company to propel its relationships across healthcare," the analysts added. 

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The J.P. Morgan analysts upgraded its stock price target from $27 to $30. 

Wentworth's transition into CEO comes just after the company reported a loss of $180 million during the fourth quarter and missed Wall Street expectations.