Best Buy Co., Inc. (NYSE: BBY) has been anything but great for investors in the last year. The electronics retailer might have been considered “Worst Buy” by Wall Street when it comes to retail. Even the smartphone sales and Apple sales couldn’t manage to keep the rest rising. But apparently bad news can get priced in according to some analysts. Credit Suisse has initiated coverage on Best Buy with a OUTPERFORM rating and even gave a price target objective which implies 28% upside to $32.00 per share.
Here are some notes:
- Best Buy stock has been banished into the “display hall for Amazon” multiple range, with the multiple lower today than at any time since BBY’s swoon with death back in the mid 1990’s.
- There is a perception that the management team is just rearranging deck chairs on the Titanic. That misses both the steps they have already taken…
- Dunn closed the unprofitable Best Buy large store division in China
- Where we need to see action this year is on a more rapid move to right size the store, more exclusives…
- BBY has a very strong free cash flow yield and that is not likely to deteriorate quickly.
No trading volume has yet been seen and at $25.02 as of the Thursday closing bell, the 52-week range is $21.79 to $35.45.
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