Bottom for Best Buy?
Best Buy (BBY) has lost more than 1/3 of its market cap over the past two trading sessions. Justified or overdone?
Depends on how you view it. More importantly were you in the stock before the earnings call? If you were you are probably never investing in BBY again, I don't blame you.
The general consensus is Best Buy is in for more pain. Thus the stock could keep dropping. I for one am willing to take a chance on the massive pullback.
Cramer said wait for the second day drop. That was Friday (Jan 17th) and it shed another 9%. Now what?
Folks Best Buy is not dead. For those who didn't gamble on the earnings call, this is a vulture play. Buy the stock now that it has been hammered. Put in tight stop/loss limits for yourself. If the stock is a falling knife then wait for an absolute bottom. I think BBY is going to bounce 2% when the market opens back tomorrow (Jan 21st).
Besides missing earnings BBY expects operating margin excluding items to be 175 to 185 basis points lower in the fourth-quarter than compared to one year earlier. Best Buy did report that domestic online revenue totaled $1.32 billion, while comparable online sales rose 23.5%.
If you are a bottom feeder like myself then this presents an opportunity for traders. I took a small position today and will wait for next week's action to determine if I will buy more. Some analysts cut their target prices on Best Buy to around mid $30's. I'm game for that and believe in 12 months BBY will be up $10 from today's $24 price.
Best of the Blogs
Scanning and identifying the best blog entries every hour
- Chinese Police Forces To Carry Guns For First Time In Over 60 Years | ZeroHedge
- Tuesday Humor: QE Was For "The Man On The Street" Says Chairman Emeritus Bernanke | ZeroHedge
- The Chinese Housing Ponzi Exposed: "As We Sell Our First Apartments, We’ll Have Cash Flow To Build The Next Stage" | ZeroHedge
- Uranium Is A Frustrating Business | iBankCoin.com
- Hoisington On The End Of The Fed's (Mythical) "Wealth Effect" | ZeroHedge
- Turning Points | Financial Sense
- Explaining The Horrendous Home Sales Report: It Snowed Everywhere But In The Northeast | ZeroHedge
The most relevant financial news and articles from the Internets
- 25 Ways to Make LinkedIn Work for You | BusinessWeek
- SATOSHI'S REVOLUTION: How The Creator Of Bitcoin May Have Stumbled Onto Something Much... | Business Insider
- Palantir, the War on Terror's Secret Weapon | BusinessWeek
- Possible Debris From The Missing Malaysian Plane Washed Up In Western... | Business Insider
- This Amazing Video Destroys Those Awful, Patronizing Dove Ads | Business Insider
- 15 Movies You Need To See This Summer | Business Insider
- After Years Of Rapid Growth, US Mobile Payment Adoption Slows | Business Insider