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
- Global Central Bank-Driven Stock Rally Fizzles; Crude Rebounds On Saudi Oil Production Cut Report | ZeroHedge
- State Street: "Move Over Zero Hedge, There Is A New Bear In Town" | ZeroHedge
- Guns Sell Out In Charlotte As Local Police Refuses To Release Shooting Video | ZeroHedge
- How Trump Wins The Debate | ZeroHedge
- Weiner Gets Clipped? NYPD Launches Investigation Of Sexting Scandal with Underaged Girl | ZeroHedge
- Ted Cruz Endorses Donald Trump: "After Many Months Of Prayer I Have Decided I Will Vote For Donald Trump" | ZeroHedge
- Gartman: "We Are Now Of Course Net Long Of Equities" | ZeroHedge
The most relevant financial news and articles from the Internets
- Yahoo gave Verizon only two days notice of the massive breach of 500 million users | Business Insider
- The 5 best new songs you can stream right now | Business Insider
- This man just won a very special award for turning himself into a goat | Business Insider
- 10 clever ways to hack the Starbucks menu this fall | Business Insider
- 7 money mistakes you probably made today without realizing it | Business Insider
- 2 of the biggest exchange groups in the US are in takeover talks: Bloomberg (CBOE, BATS... | Business Insider
- China wants to build a US-style aircraft carrier | Business Insider