Elliot Turner of RGA Investment Advisors presented his in-depth investment thesis on Walgreens Boots Alliance (Nasdaq: WBA) at Best Ideas 2018.
Says Stefano Pessina, “Many people say that I am a dealmaker, which is probably true. But I am always very cold when I do a deal. A deal must have a strategic logic, and it must create value.” Since William Thorndike’s The Outsiders captured investor imaginations, everyone has been searching for the “ninth chapter”. According to Elliot, Stefano Pessina might be a worthy nominee. Pessina is a nuclear engineer who turned his father’s struggling drug wholesale business into a series of 1,500 acquisitions, leading to a 14% stake in Walgreens.
Walgreens Boots Alliance had a rough year in the stock market in 2016, thanks to repeated threats of Amazon’s entry into the pharmacy business and a protracted attempt to take over Rite Aid. 2018 begins with Pessina’s first truly blank slate in order to execute his vision of a global scale player in wholesale and distribution with a unique focus on front-end optimization.
Walgreens has a long history of fulfilling customer needs amidst a dynamic backdrop. Early in its history, most of the company’s profitability came from the front end, while now the pharmacy drives the bottom line. Change is really the only constant, and Pessina is the ultimate leader steering the ship, with his interests aligned. The combination of a business that fills an essential life need, a cheap valuation, and a focused owner-operator makes WBA a “best idea” for 2018.
About the instructor:
Elliot Turner is a co-founder and managing director at RGA Investment Advisors, LLC. RGA Investment Advisors runs a long-term, low turnover, growth at a reasonable price investment strategy seeking out global opportunities. Elliot focuses on discovering and analyzing long-term, high quality investment opportunities and strategic portfolio management. Prior to joining RGA, Elliot was managed portfolios at at AustinWeston Asset Management LLC, Chimera Securities and T3 Capital. Elliot holds the Chartered Financial Analyst (CFA) designation as well as a Juris Doctor from Brooklyn Law School. He also holds a Bachelor of Arts degree from Emory University where he double majored in Political Science and Philosophy.
Members, log in below to access the full session.
Not a member?
Thank you for your interest. Please note that MOI Global is closed to new members at this time. If you would like to join the waiting list, complete the following form:
About The Author: MOI Global Editorial Team
The MOI Global Editorial Team, led by John Mihaljevic, CFA, includes community builders, event organizers, writers, editors, research associates, security analysts, and fanatical member support advocates. Our sole purpose is to serve the members of MOI Global as well as we possibly can in order to help them learn, invest intelligently, and build lifelong friendships with like-minded people.
Who is MOI Global? In recent years, The Manual of Ideas has expanded to become more than simply “the very best investing newsletter on the planet” (Mohnish Pabrai). We are now a thriving global community of intelligent investors, connected through great ideas, thought-provoking interviews, online conferences, live member events, and much more.
Members of MOI Global enjoy complimentary access to a growing array of resources and content related to the art of intelligent investing. Members also enjoy preferential access to selected offline events as well as exclusive access to other events hosted by MOI Global, including the Zurich Project Summit, the Latticework Conference, and Ideaweek.
More posts by MOI Global Editorial Team