Investing Based on Demographics - SC

Shoppers Drug Mart - SC

“Provides pharmacy products and services through retail drug stores across Canada. The company licenses its drug stores to pharmacists or associates who operate a retail drug store at a specific location in Canada using the company's trademarks, Shoppers Drug Mart”

Dividend Yield: 1.2%
ROE: 16.53%
PE: 26X
Estimated 2007 PE: 24X
Estimated 2008 PE: 21X

THESIS: the thesis behind this company is the same as WAG and CVS: older people take more drugs and fill more prescriptions. SC should also benefit from seniors buying more beauty items in an effort to keep looking young as well as more impulse items simply because they’ll be in the store more. SC is also now has cosmetic consultants that are placed right by the entrance of many of their stores to target older women who want to stay looking good. I think SC is a great company but would not be a buyer at these valuations.