Best Buy’s stock has fallen 2.3% on a year-to-date basis

Best Buy’s (BBY) stock fell 2.6% to $29.95 on February 19 following a downgrade by Goldman Sachs from “buy” to “neutral.” A sluggish wireless market triggered the downward revision. As discussed in part one of this series, a slowdown in mobile phone sales adversely impacted Best Buy’s holiday sales.

Best Buy’s Stock Has Fallen 2.3%: Will Fiscal 4Q16 Results Help?

Best Buy’s stock has fallen 2.3% on a year-to-date basis. The stock prices of peers GameStop (GME), Aaron’s (AAN), and Conn’s (CONN) have fallen 0.4%, 2.9%, and 18.3%, respectively, since the start of 2016. The SPDR S&P Retail ETF (XRT) and the S&P 500 Index have fallen 3.8% and 4.7%, respectively, since the start of the year.

Best Buy constitutes 1.2% of XRT and 0.1% of the iShares Russell 1000 Value ETF (IWD).

Fiscal 4Q16 earnings expectations

Best Buy is scheduled to announce its earnings for fiscal 4Q16, which ended January 30, 2016, on February 25. Analysts expect Best Buy’s adjusted EPS (earnings per share) to come in at $1.39, a 6.1% decline on a YoY (year-over-year) basis. For fiscal 2016, the adjusted EPS are expected to be $2.64, reflecting a 1.5% rise on a YoY basis.

Analysts’ recommendations

As of February 19, 12 of the 24 analysts following Best Buy gave it a “hold” recommendation. Ten analysts gave a “buy” recommendation, and two gave a “sell” recommendation. The 12-month target price for Best Buy’s stock is $34.10, which indicates potential for a 13.9% rise from the stock price on February 19.

Best Buy has been implementing several measures to boost its sales, including the opening of several stores-within-stores in collaboration with key vendors. The company is also streamlining its operations and bringing down its costs. The retailer has been experiencing strong sales of large screen TVs. However, subdued consumer spending on discretionary goods and a slowdown in mobile sales have been acting as hurdles to the company’s revival.

For more updates on this sector, visit our Consumer Discretionary page.

Latest articles

Broadcom (AVGO) stock fell ~8.5% after markets closed yesterday following the semiconductor giant's fiscal 2019 second-quarter earnings release. It missed analysts' revenue estimate and cut its fiscal 2019 revenue guidance by $2 billion to $22.5 billion due to sluggishness in its semiconductor solutions business.

The SPDR Gold Shares ETF (GLD), which tracks physical gold prices, has underperformed the broader markets year-to-date, rising just 4.4% compared to the S&P 500’s (SPY) gain of 15.9% as of June 14. The sentiment for gold, however, has been turning around.

Safe havens such as Treasuries and gold were back in favor on June 14 as stocks fell due to rising tensions in the Middle East, concerns over growth, and the looming threat of the US-China trade war. The tech-heavy Nasdaq Composite Index fell 0.67% in the first hour of trading.

Lululemon (LULU) stock rose 2.1% on June 13 in reaction to better-than-expected first-quarter results and an upgraded outlook for fiscal 2019 overall. The company's first-quarter adjusted EPS grew 34.5% to $0.74 on revenue growth of 20.4% to $782.32 million. Analysts had expected EPS of $0.70 and revenue of $755.31 million. Here's why the outlook got an upgrade.

14 Jun

IEA Again Slashes Its Oil Demand Growth Estimate

WRITTEN BY Rabindra Samanta

As of 4:40 AM Eastern Time today, US crude oil active futures were at $51.83, ~4% below their closing level in the previous week. If US crude oil prices stay at those levels today, they'll mark their third week of decline in five weeks.

Amazon is discontinuing its Amazon Restaurants service, which has been delivering food for restaurants in parts of the United States. Amazon Restaurants launched in the United States in 2015 and entered the British market the following year. However, it met strong opposition in the British market.