Walgreen Company (NYSE:WAG) - Following A Wealth Creation Strategy

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The recurring theme on ValueExpectations.com is that the market rewards companies that follow a wealth creation strategy of growing a profitable business. In other words, the market favors companies that generate positive Economic Margins (true measure of economic profitability) and are capable of expanding their business.

The example we are providing today Walgreen Co. (NYSE:WAG) is a poster-child of these themes as it has maintained positive Economic Margins for over the last 10 years, and has consistently grown their asset base during the same time period. In addition, WAG’s EM levels have outpaced many of their direct competitors (as seen in the second report below relative to OCR, RAD & CVS). Looking at the Cumulative Return vs. S&P500 chart in the Wealth Creation Report, it is not surprising that Walgreen Co. (NYSE:WAG) outperformed the market over this time period.

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From a valuation perspective, Walgreen Co. (NYSE:WAG) is also a company that looks to be trading at a discount to its intrinsic value (seen in top part of chart). A company following a wealth creation strategy and trading at a discount is definitely a company to pay close attention to.

If you would like to learn more about The Applied Finance Group’s understanding of how management teams create or destroy wealth for their shareholders and how this can help investor’s with their stock selection process...Click Here.

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