Best Buy Faces Sales Challenges Amid Market Pressures
Written by Emily J. Thompson, Senior Investment Analyst
Updated: Feb 02 2026
0mins
Should l Buy BBY?
Source: seekingalpha
- Sales Downgrade: J.P. Morgan downgraded Best Buy's rating from Overweight to Neutral, reducing the target price by 23% to $76, reflecting concerns over future sales growth, particularly as the anticipated boosts from 2025 tax refunds and hardware updates may not offset tough comparisons to 2025.
- Market Uncertainty: Despite strong comparable sales and margin upside in Q3, the lack of specificity on quarter-to-date trends has raised doubts about the company's outlook, especially as December sales did not rebound as expected amid consumer uncertainty related to tariff inflation and labor market concerns.
- Memory Market Pressures: J.P. Morgan's tech analysts expect computer memory costs to double, prompting most PC brands to raise new product prices by 20% to 30%, which could impact Best Buy's core business as PC sales are projected to decline in high single digits in 2026.
- Unfavorable Earnings Forecast: Horvers models a -3% total/U.S. comparable sales for Q4, with a slight increase in gross margin to 21.0%, but the company's guidance appears overly optimistic given the sluggish housing market, which may hinder continued growth in computing, mobile, and gaming sectors.
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Analyst Views on BBY
Wall Street analysts forecast BBY stock price to rise
12 Analyst Rating
5 Buy
6 Hold
1 Sell
Moderate Buy
Current: 64.870
Low
60.00
Averages
83.33
High
99.00
Current: 64.870
Low
60.00
Averages
83.33
High
99.00
About BBY
Best Buy Co., Inc. is engaged in personalizing and humanizing technology solutions. The Company has two segments: Domestic and International. The Domestic segment comprises its operations in all states, districts and territories of the United States and its Best Buy Health business and includes the brand names Best Buy, Best Buy Ads, Best Buy Business, Best Buy Essentials, Best Buy Health, Geek Squad, Imagine That, Insignia, Lively, My Best Buy, My Best Buy Memberships, Pacific Kitchen and Home, TechLiquidators and Yardbird; and the domain names bestbuy.com, lively.com, techliquidators.com and yardbird.com. The International segment comprises all its operations in Canada under the brand names Best Buy, Best Buy Express, Best Buy Mobile, Geek Squad and TechLiquidators and the domain names bestbuy.ca and techliquidators.ca. The Company’s product categories include computing and mobile phones, consumer electronics, appliances, entertainment, services and others.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
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- Call Option Returns: Selling a call option at a $68.00 strike price allows investors to collect a $2.51 premium on the current stock price of $67.49, resulting in a total return of 4.47% if the stock is called away, though it risks missing out on further upside potential.
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