Best Buy Analyst Turns Bullish After Meetings With Management

Earlier this month, Best Buy Co Inc (NYSE: BBY) reported higher-than-expected results for its fourth quarter.

Meetings with management boosted confidence in the company’s business “showing signs of stabilization and improvement after nine consecutive quarters of negative comps, according to Telsey Advisory Group.

The Best Buy Analyst: Joseph Feldman upgraded the rating for Best Buy from Market Perform to Outperform, while raising the price target from $85 to $95.

The Best Buy Thesis: The company’s business is poised to be driven by the start of the replacement cycle, especially for products purchased between 2019 and 2020, and as “innovation starts to gain traction,” Feldman said in the upgrade note.

Check out other analyst stock ratings.

“In select categories, such as laptops, Best Buy is already seeing a positive comp due to the replacement cycle and the trend is expected to strengthen as new technology hits the market around the back-to-school timeframe,” the analyst wrote.

He added that product innovations were ramping, including Samsung's AI-enabled phone and Microsoft’s Copilot laptops, “which should help attract consumers and fuel growth.”

“Best Buy also is starting to benefit from the growth of higher margin services (~7MM paid loyalty members), which should provide further upside as the business scales in 2024 and beyond,” Feldman further stated.

BBY Price Action: Shares of Best Buy had risen by 2.12% to $78.93 at the time of publication on Wednesday.

Read Next: Stocks At Record Levels Even As Rate Cut Hopes Fade: 'The Strength Of AI Hype Is Truly Historic''

Photo: Shutterstock