Best Buy stock price forecast ahead of Q2 earnings

By: Crispus Nyaga
Crispus Nyaga
Crispus is an active trader, where he is followed and copied at Capital.com. He lives in Nairobi with his… read more.
on Aug 24, 2021
  • The Best Buy stock price has gone nowhere in the past few weeks.
  • It is hovering near its all-time high ahead of earnings.
  • Analysts will be focusing on the company’s guidance.

The Best Buy (NYSE: BBY) stock price is loitering near its all-time high as investors wait for the company’s quarterly results. The stock is trading at $112, which is slightly below its all-time high of $128. It has a market capitalization of more than $28 billion.

BBY  earnings preview

Best Buy is a leading electronics and technology retailer with more than 1,100 stores in the US and Canada. The company is a major seller of products like gaming consoles and computers. 

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It is also one of the best-performing retailers in the US because of the additional services it offers like services and installation. Also, it has invested substantially in its e-commerce operations that make it more attractive to customers.

Best Buy revenue and profitability have been in a strong bullish trend. Its total revenue has jumped from more than $39 billion in 2016 to more than $47.2 billion in 2020. Its profits jumped to more than $1.7 billion.

This strong performance in 2020 happened as the demand for computers and gaming consoles rose as more people spent time at home. Therefore, the recent lagging performance of the Best Buy stock price is mostly because of the fear that its strong growth will start fading.

Best Buy will publish its quarterly results on Tuesday after the regular session. Analysts expect the company’s revenue rose to more than $11.54 billion in the second quarter. This will be a substantial increase from the $9.9 billion it made in the same quarter in 2020. It will also be slightly below the $11.64 billion it made in the previous quarter.

Analysts are optimistic about the Best Buy stock price. Most of them have a buy, strong buy, and hold rating on the stock. A smaller number has a sell rating. The average target of the stock is $124, which is about $12 above the current level. The most optimistic analysts are from Piper Sandler, who expect that the shares will jump to $144.

Best Buy stock price forecast

Best Buy stock

The daily chart shows that the BBY stock price has been moving sideways in the past few weeks. Along the way, it has found a support and resistance at $107 and $124. The shares are along the 25-day and 50-day moving averages while the Relative Strength Index (RSI) is at the neutral level of 50. 

Therefore, at this point, the outlook of the Best Buy share price is neutral. The key levels to watch will be the support and resistance points mentioned above.

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