Best Buy (NYSE: BBY) shares have lost roughly 20%, in 2022, compared to the S&P 500, which lost 14% year-to-date (YTD). Despite the stock not performing well, the founder of Best Buy, Richard M. Schulze bought up roughly $20 million of the electronics retailer’s shares.
On May 25, Form 4 was filed with the SEC indicating that 250,000 shares were bought up by the Best Buy founder.
Meanwhile, in its latest earnings report on the same date, the company showed $10.65 billion in revenue, which represented a year-on-year (YoY) decrease of 8.5%; however, it still beat expectations by $220 million. Similarly, earnings per share (EPS) was $1.57, beating estimates by $0.01.
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Even so, analysts from Barclays downgraded the stock following the earnings report, citing worries of a consumer slowdown and other macro trends.
BBY chart and analysis
Towards the end of May, higher trading volumes were noted, which led the shares to bounce off of $70, multiple times possibly creating a new support level. Despite this, shares are now trading below all daily Simple Moving Averages (SMAs), and have been in a continuous downtrend since December 2021.
On the other hand, analysts rate the shares a moderate buy, predicting that in the next 12 months, shares may be trading at an average price of $91.27, which is 16.49% higher than the current trading price of $78.35.
Even with the probable headwinds, analysts are citing, shareholders are likely to enjoy the dividend yield the company provides. At the time of writing, the yield stands at 4.79%, which means that shareholders will get $0.88 for each share they own.
Moreover, there seems to be cautious optimism among banks regarding the state of the U.S. consumer. If spending continues, BBY should be in a good position to recover some of the losses sustained mostly due to worries of a consumption slowdown.
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