Best Buy (BBY) Stock Gets Ratings Upgrade Today at Oppenheimer
NEW YORK (TheStreet) --Shares of Best Buy Co. Inc. (BBY) - Get Report are higher by 1.77% to $36.73 at the start of trading on Friday morning, following a ratings upgrade to "outperform" from "market perform" at Oppenheimer.
The firm said it upped its ratings on the technology, entertainment, and electronics retailer as the company's new management is cutting costs and its competitive issues are softening.
"Challenges persist for Best Buy. We are nonetheless encouraged that the worst is likely over for Best Buy. A new senior leadership team has aggressively cut cost and dramatically improved strategic positioning at the chain," Oppenheimer said in an analyst note.
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The firm set a $43 price target on Best Buy stock.
Separately, TheStreet Ratings team rates BEST BUY CO INC as a Hold with a ratings score of C. TheStreet Ratings Team has this to say about their recommendation:
"We rate BEST BUY CO INC (BBY) a HOLD. The primary factors that have impacted our rating are mixed some indicating strength, some showing weaknesses, with little evidence to justify the expectation of either a positive or negative performance for this stock relative to most other stocks. The company's strengths can be seen in multiple areas, such as its solid stock price performance, impressive record of earnings per share growth and compelling growth in net income. However, as a counter to these strengths, we also find weaknesses including poor profit margins and weak operating cash flow."
Highlights from the analysis by TheStreet Ratings Team goes as follows:
- Powered by its strong earnings growth of 150.00% and other important driving factors, this stock has surged by 50.56% over the past year, outperforming the rise in the S&P 500 Index during the same period. Regarding the stock's future course, our hold rating indicates that we do not recommend additional investment in this stock despite its gains in the past year.
- BEST BUY CO INC reported significant earnings per share improvement in the most recent quarter compared to the same quarter a year ago. The company has demonstrated a pattern of positive earnings per share growth over the past year. We feel that this trend should continue. This trend suggests that the performance of the business is improving. During the past fiscal year, BEST BUY CO INC turned its bottom line around by earning $1.98 versus -$0.81 in the prior year. This year, the market expects an improvement in earnings ($2.45 versus $1.98).
- The current debt-to-equity ratio, 0.36, is low and is below the industry average, implying that there has been successful management of debt levels. Despite the fact that BBY's debt-to-equity ratio is low, the quick ratio, which is currently 0.52, displays a potential problem in covering short-term cash needs.
- Net operating cash flow has declined marginally to $287.00 million or 5.90% when compared to the same quarter last year. Despite a decrease in cash flow of 5.90%, BEST BUY CO INC is in line with the industry average cash flow growth rate of -6.46%.
- The gross profit margin for BEST BUY CO INC is rather low; currently it is at 24.45%. It has decreased from the same quarter the previous year. Along with this, the net profit margin of 1.14% trails that of the industry average.
- You can view the full analysis from the report here: BBY Ratings Report
