Rite Aid's comps are no panacea for stock price

Actually, the sales aren't week. RAD doesn't have the capacity of WAG or CVS. Regarding stock performance, they are in the middle of absorbing a major acquisition which puts them in an advantageous position for competing with WAG and CVS. By fiscal '09 RAD will be cash flow - positive, and the valuation will begin to move as things begin to take hold. RAD gets a bum rap from the days of crooked management and scandals. Let it go - this new management team led by Mary Sammons is first rate.

I agree that WAG is a better operator. But when investing, it is all relative. What matters is not who is better, but who is going to show the most improvement as we round the bend. I think the answer to that is RAD. Keep in mind that SSS figures are affected significantly by new store ramp ups. WAG has been adding stores at an ferocious pace for years. Hence they always have a large stable of sites that are in their first 5 years - which is when you see the greatest year-over-year percentage increases in sales. RAD did not open a single new store for about 5 years, but began a new store program about 2 years ago and is now integrating a major acquisition. Before long, RAD will begin factoring in new stores, which in turn juices the SSS figures. (The acquired stores become part of SSS in June of this year.) It's still a long road before they turn in sales or margins anywhere close to WAG... if ever. But that is irrelevant. By 2009, the debt will begin to get whittled down and earnings will start to grow positive. Two years out we should see 50 cents a share or better, which might convert into a share price of about $10. Could WAG stock triple in 2 years as well? Nope.

Hey stop making excuses for these people. I have owned this for years lived not far from the young Mr. Grass the destroyer and my wife was his Ex Secretary for as long as she could take it. He wrecked it but the current people have done nothing but make more excused and tons of $ for results like they just turned in and I am sick of the excuses. They have everything and more that the others have. I talked to store managers before buying and they were upbeat things would change. Nothing has changed. And Pharmacists think its punishment to work there. They are old and crotchity at night or young and swarthy in the daylight hours and to busy impressing the multitude of giggling girls behind the counter. The stores are more often dirty and dingy looking and they are out of any number of the top 25 drugs far to often. No hustle when they are either, you get your script back. I write the board a blistering letter every year and every year its the same . Don't fall in love with this stock. Big mistake. I got in around a buck and have no0t much more to lose but to go from where they were to something over $2.00 and more excuses? I am surprised they have nerve enough to ride this out yet again. And I told the boaed if any options are granted they better strike at where the stock should be not this $2.00 plus nonsense. They don't deserve to continue making $5,000,000 up from options and one more item and I shut up. Soon congress will allow Medicare the ability to bargin for better drug pricing. Rite Aide is heavily into that business. Where do you see them after that. Be very concerned here gentleman and throw all the trends, etc in the garbage. I would have killed to keep the EPS positive I don't care what, just positive. They could not. Its house cleaning time once again. They cut expenses until the EPS is in the black and stays there. No excuses, results only. The analysts are done with this company otherwise. If they can't make money by now, they won't. New stores will just be brought down to the Rite Aide level. It has to feel like being purchased by Waste Management now to be picked up by these bottom dwellers.

Only positive thing to say about this company is that it has great ice cream (thrifty). Management treats employees like you know what! I work there for 20 years and the pressure from the top is unbearable plus there attempt to buy up run down drug stores doesn't help! Y\They can't compete with Walgreens! Stock at 1.35, looks really bad for company!