Best Buy Co., Inc. (BBY)’s share price surged over 250% in 2013 on the hope that the electronic giant will be able to soon turnaround its waning revenues and earnings. Best Buy’s stock price gain came to halt, in fact dropped by a huge margin, when the management announced that Best Buy’s revenues dropped by 0.8% in the stores opened for at least one year. This led to a year-to-date drop of 35% in Best Buy’s share price.
In the latest reported results, Best buy’s earnings were above analysts’ estimates, while revenues failed to meet the Street’s expectations. Although holiday season is the most important period of the quarter, many retailers were punished for providing disappointing results for this season; the lower-than-expected results were attributable to a number of reasons including low traffic in stores and cold weather.
Last week I came across this new website, Bidness Etc. They provide researched analysis on stocks, and that too free of cost. I read their Best buy’s investment analysis on the site. They are bullish on the stock and are convinced that the electronic retailer’s turnaround strategy, which is labeled as ‘Renew Blue’ will work. The website suggests Best Buy’s policy of matching prices with other electronic retailers, its focus on e-commerce, its strategy to open shop-in-shops of big vendors, and its aggressive cost cutting initiatives are yielding great results, and the company will soon be able to get back to its path of success.