03:19 PM EST, 01/31/2025 (MT Newswires) -- Walgreens Boots Alliance's ( WBA ) shares were sliding intraday Friday following the company's decision to suspend its dividend, though RBC Capital Markets sees the move potentially accelerating the drugstore chain's turnaround plan.

Walgreens said late Thursday that the decision comes as it continues to assess its capital allocation policy. "The company's cash needs over the next several years, including with respect to litigation and debt refinancing, were important considerations as part of the decision to suspend the dividend," Walgreens said in a statement.

Its shares were down 10% in Friday late-afternoon trade.

The company said it aims to paring debt and improve free cash flow as it works toward achieving "a retail pharmacy-led turnaround underpinned by a sustainable economic model."

Walgreens continues to "evaluate the appropriateness and size" of its dividend, Chief Financial Officer Manmohan Mahajan said on an earnings conference call earlier this month, according to a FactSet transcript.

In the light of Mahajan's remarks, the company's decision to suspend its dividend is not surprising, RBC analyst Ben Hendrix said in a note e-mailed Friday. The move is expected to put Walgreens in a better financial position to execute its turnaround plan in a more timely manner and save about $865 million annually, according to the note.

Separately, Truist Securities on Friday lowered its price target on the Walgreens stock to $12 from $13 while maintaining its hold rating.

Toward the end of 2024, The Wall Street Journal reported that the drug-store operator was in discussions to sell itself to private-equity firm Sycamore Partners.

"Our priority for fiscal 2025 is to stabilize our core performance while we make progress on the longer term strategic and operational turnaround," Mahajan said on the conference call to discuss fiscal first-quarter results.

Price: 10.33, Change: -1.14, Percent Change: -9.90