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Walgreens Boots Alliance (WBA, Financials) stock fell 13.9% to $9.86 as of 11:03 a.m. GMT-5 on Friday following the company's announcement to suspend its quarterly cash dividend. The move is part of Walgreens' efforts to restructure its capital allocation strategy.
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Key considerations in the relocation were the debt refinancing and lawsuit expenses mentioned by the drugstore and retail company established in Deerfield, Illinois. The business said that the dividend suspension fits its larger initiatives toward a sustainable economic model guided by a retail pharmacy turn-around plan.
Walgreens Boots Alliance said it is still dedicated to carry out its strategic goals while maintaining financial discipline. The business underlined that even with the quick changes to its capital allocation strategy, long-term wealth generation is still a major goal.
Walgreens Boots Alliance has around 12,500 stores all throughout the United States, Europe, and Latin America. Employing about 312,000 people, it owns brands like Walgreens, Boots, and Duane Reade.
Future dividend payments, the corporation said, will depend on financial situation and continuous assessment of its strategic projects. Walgreens Boots Alliance omitted a chronology showing when it would resume the dividend.
This article first appeared on GuruFocus.