NEW YORK (TheStreet) -- Shares of Best Buy Co. (BBY) - Get Best Buy Co., Inc. Report are down 1.28% to $26.58 in early morning trading on Friday after the company's stock rating was lowered to "perform" from "outperform" at Oppenheimer, which also removed its price target.
The Richfield, MN-based electronics retailer's management has made the business "much more capital disciplined, and significantly better positioned to compete online," but the slowdown in consumer spending is not expected to end soon, Oppenheimer said in an analyst note this morning.
"Our downgrade of shares reflects external factors and our view that in a period of potentially constrained consumer spending that investors are unlikely to award shares of BBY a higher multiple, particularly given nearer-term uncertainties in the consumer electronics product cycle," analysts added.
Analysts will be watching the company's fiscal 2017 guidance when Best Buy releases its fiscal 2016 fourth quarter results on February 25 before the market open.
Guidance is expected to show "subdued sales and operating income forecasts given the company's conservative nature, ongoing challenges in the [consumer electronics] sector, and continued investments from the chain," analysts noted.
Separately, Best Buy has a "hold" rating and a letter grade of C+ at TheStreet Ratings because of the company's strengths, such as increase in net income, reasonable valuation levels and largely solid financial position, and its weaknesses, including weak operating cash flow, generally disappointing stock performance and disappointing return on equity.
You can view the full analysis from the report here: BBY
TheStreet Ratings objectively rated this stock according to its "risk-adjusted" total return prospect over a 12-month investment horizon. Not based on the news in any given day, the rating may differ from Jim Cramer's view or that of this articles's author.