03:19 PM EST, 01/06/2025 (MT Newswires) -- Walgreens Boots Alliance ( WBA ) investors concerns on whether Sycamore Partners can successfully acquire the company have overshadowed its fundamentals, UBS said in a report sent Monday.

"We believe most are skeptical a deal will get done, but the potential binary outcome, along with unknown timing has taken many active investors out of the stock," the firm said.

As the stock's deal-related premium has dissipated in the absence of an update, investors are expected to focus on the reported buyout deal in an upcoming call, UBS said.

"We sense investors running traditional [leveraged buyout valuation] models struggle to see how the math works given the lack of [free cash flow]," the firm said. "Any update on a potential transaction/s could create volatility."

The pharmacy, health and wellness company's fundamentals, meanwhile, remain challenged, UBS said as it lowered its fiscal Q1 earnings per share estimate to $0.36 from $0.39, below consensus forecast of $0.38. The firm is now projecting a fiscal 2025 EPS of $1.55, down from its prior estimate of $1.57.

UBS has a neutral rating on the stock and price target of $10.

Price: 9.52, Change: +0.02, Percent Change: +0.16