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
- Davidowitz: Retailers in 'Survival Mode' as Headwinds Multiply | Financial Sense
- Here's The Full List Of Organizations That Paid Hillary Clinton From 2013-2015 | ZeroHedge
- What the Greek Deal Does and Does Not Do | Financial Sense
- Emerging Markets Turmoil Signal Pain Ahead For US Stocks | ZeroHedge
- The Ebb and Flow of Inventories | Financial Sense
- Chicago Pension Liabilities Jump 168%, Understated by $11.5 Billion | Financial Sense
- The War On Cash Is A War On Your Freedom To Opt Out | ZeroHedge
The most relevant financial news and articles from the Internets
- 48% of Americans saving for retirement are pretty sure they have no idea... | Business Insider
- How different networking standards are competing to connect the Internet of Things | Business Insider
- These amazing moving maps show how far Americans travel to get to work | Business Insider
- There will be 34 billion IoT devices installed on Earth... | Business Insider
- Home prices are getting out of control in these 18 American markets (Z) | Business Insider
- THE FINTECH REGULATION REPORT: How European regulators are creating fertile ground for... | Business Insider
- Here's where people are relocating in the US | Business Insider