Rite Aid posts gains, then falls back again
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share thisThe worsening employment picture and fear of sliding consumer spending sent retail stocks down, with shares of drugstore operator Rite Aid Corp. having to give back substantial gains made during the week.
The stock finished the week on Thursday at $1.39 per share, a 12 percent increase for the week. The market was closed Friday in observance of the Fourth of July.
Rite Aid's successful refinancing of debt associated with the 2007 acquisition of the Brooks/Eckerd chain was well received by investors in last week's abbreviated session, which drove shares to $1.54 by Thursday. But Thursday's dim job reports sent commodities and stocks linked to consumer spending tumbling.
The economy lost 467,000 jobs in June, far more than expected. Unemployment ticked higher to 9.5 percent.
Also pushing Rite Aid down was the report of a drop of 0.6 percent in sales in June. Front-end same-store sales in the four weeks ending June 27 fell 4.5 percent, while pharmacy same-store sales rose 1.4 percent.
Camp Hill, Pa.-based Rite Aid operates stores throughout Northeast Pennsylvania. The chain was born in Scranton, with its first store on North Washington Avenue. For the last fiscal year, ending in February, the chain had more than $26 billion in sales.
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