Piper Sandler analyst raised Best Buy’s price target to a ‘Street High’ of $127 (17.7% upside potential) from $112, citing expectations for strong upside in the second half of the year and in 2021. Shares of the consumer electronics retailer rose 2.8% on Thursday, hitting a 52-week high of $108.44.
Piper Sandler analyst Peter Keith maintained a Buy rating on Best Buy (BBY). Keith pointed to “the likelihood of a very strong Q3/Q4” in the near term, with strong back-to-school spending and new product cycles acting as short-term drivers. Over the long-term, the analyst believes that COVID-19 “is illuminating BBY’s strength as an e-com retailer, and can also be a catalyst for growth in BBY’s Health initiatives.”
Last month, Best Buy reported strong sales in the three months through July 18. Sales grew 2.5% year-over-year sales during the reported quarter driven by a spike in online sales. Online sales jumped 255% in the period compared to the prior year, fueled by strong demand for computing, appliance and tablet products. Best Buy is set to report its 2Q results on Aug. 25.
Currently, the Street has a cautiously optimistic outlook on the stock. The Moderate Buy analyst consensus is based on 10 Buys and 9 Holds. Following the stock’s 25% year-to-date rally, the average price target of $98.59 now implies downside potential of 8.6%. (See BBY stock analysis on TipRanks).
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