Rite Aid Corporation (NYSE: RAD) stock remained on the green territory on Friday after falling over 24% in the past month. The company has been struggling to recover from the multi-year low on August 27 of $5.04. So far this year, the shares have fallen over 43% despite rising over 12% in the past three months.
Investors remained cautious ahead of the company’s earnings results for the third quarter of 2020 in the mid of December. The stiff competition in the drugstore industry has been impacting the company. This pressurized Rite Aid into making additional investments in the marketing space for acquiring customers.
However, the company has been trying to enhance its digital capabilities for driving growth and developing stronger relationships with its customers. Rite will amend marketing investments for attracting customers into its digital channels, resulting in higher in-store and online revenue.
The digital business, which remained a significant opportunity for the company, has risen relatively small during the second quarter. In the long term, the digital business could turn out to be the major contributor to growth for Rite Aid.
The company continues to face weakness in the Retail Pharmacy segment due to lower foot traffic count at its stores. The company could turn beneficial in the future as its partnership with Amazon (NASDAQ: AMZN) for adding locker and counter services will drive additional traffic and attract new customers to Rite Aid stores.
Despite this, the company’s Medicare Part D enrollment continues to expand and now has roughly 672,000 enrolled Part D members for 2019. Rite Aid has been focusing on certain areas for improving operating performance, cost structure, and service levels.
The company remained very optimistic about the company’s growth prospects in the future. Also, the company could be beneficial by the investments in the attraction of the customers into its stores. These are likely to be the driving factor of the stock.