Oppenheimer Suggests There Might Be 'More Light At The End Of The Tunnel' For Best Buy

Brian Nagel of Oppenheimer on Friday upgraded shares of Best Buy Co Inc (NYSE: BBY) to Outperform from Perform with an established $43 price target given a view that "the worst is likely over."

Nagel notes that challenges do persist for Best Buy, but a new senior leadership team that has "aggressively" cut costs and "dramatically" improved strategic positioning changes the company's prospects for the better.

Nagel also states that struggling chains such as Sears and Radio Shack closing their operations bodes well for the company. The analyst estimates that both stores could shed as much as $9 billion in share in the consumer electronics and appliance categories.

Nagel believes that Best Buy's management set a low bar for the first half of 2015 which may set up shares for a "that wasn't too bad" type of rally when the company releases its data points.

Finally, Best Buy might chose to re-start share repurchases, according to Nagel who believes that doing so could prove to be a "significant" source of earnings per share upside.