Best Buy Stock Won't Plunge in 2011: Poll
NEW YORK (
) --
Best Buy's
(BBY) - Get Report
stock is expected to remain stagnant in 2011.
According to
TheStreet's
poll, 53.1% of voters say shares of the electronic retailer will trade between $35 and $45 by the end of next year.
Best Buy received a major blow earlier this week, seeing its biggest decreases in eight years, after third-quarter income and sales significantly missed expectations. As a result, shares plunged nearly 18% since the report, to end the week at $34.27.
During the quarter, which included the all-important Black Friday weekend, the electronics retailer earned $217 million, or 54 cents per share, from $227 million, or 53 cents, in the year-ago period. Wall Street was looking for a profit of 61 cents from Best Buy.
Revenue declined to $11.89 billion from $12.02 billion in the year prior, while same-store sales fell 3.3%. This compares with consensus estimates of $12.47 billion.
The company attributed its weakness to losing sales and about 100 basis points of market share in televisions, video games and mobile devices to competitors. Management estimates that TV sales declined in the low double-digits.
Looking ahead, Best Buy now expects full-year earnings in the range of $3.20 to $3.40 a share, compared with prior guidance in the range of $3.55 to $3.70 a share.
Despite this week's lackluster report and outlook, 22.8% of voters believer Best Buy will rally in the New Year to trade in the range of $45 to $55. The biggest catalyst for any such spike would most certainly come from an acquisition.
Following its third-quarter report, analysts speculated that one of the ways Best Buy could revive its business would be through the purchase of another retailer, such as
GameStop
(GME) - Get Report
or
RadioShack
(RSH)
. But such chatter has arisen several times with no outcome.
On the other side, 17.2% of bears see the stock falling between $25 and $35.
The outliers -- 4.2% -- see the stock spiking about $55, while 2.8% are calling for Best Buy to trade below $25 by the end of 2011.
--Written by Jeanine Poggi in New York.
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