UPDATE: Goldman Sachs Raises PT to $37 on Walgreen

Goldman Sachs increases its price target $2 to $37 on Neutral-rated Walgreen

on some constructive steps taken by the company to address the persisting status quo. Goldman Sachs says, "WAG's February quarter results did not alter the high-level picture for the firm – it continues to lose ESRX business and remain at a strategic disadvantage. That said, we note two constructive steps: (1) WAG is trimming costs faster than we anticipated. WAG claims a $0.07 hit from ESRX, versus our original $0.09 forecast, despite a deeper sales impact than originally modeled. As a result, we hike our expectation for gross savings. (2) WAG is allocating capital more judiciously, lowering capex guidance to $1.4 billion from $1.6 billion, and reducing inventory. This contrasts with recent quarters, when it invested into uncertainty." WAG closed at $34.80 a share yesterday.