Best Buy analyst, focused on earnings growth, reworks stock price target | Official Website of Louis Velazquez, entrepreneur, finance guy and tech innovator

You could say that again.

In April Best Buy (BBY) CEO Corie Barry displayed a remarkable gift for understatement during the electronics retailer’s first-quarter-earnings call.

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““It has certainly been an eventful start to the year,” she told analysts.

For those of you who don’t recall, let’s hop into the Wayback machine and set a course for just a few months when President Donald Trump announced a sweeping set of tariffs during what he called his April 2 Liberation Day extravaganza.

Trump claimed the levies tariffs would cause factories to move production back to the U.S., although the proposals rocked the stock market something brutal when they were first announced and they’re still having an impact in light of renewed trade tensions.

Best Buy posted better-than-expected first-quarter earnings but cut its outlook as Trump’s tariffs raised the cost of imported electronics.

Other companies, such as retailers Abercrombie & Fitch (ANF) and Macy’s (M) , also cut their profit outlooks at the time.

Best Buy cut its outlook as a result of President Trump’s tariffs. Photo: David Paul Morris/Bloomberg via Getty Images

Bloomberg/Getty Images

Best Buy CEO: International trade critically important

“I’m proud of how our teams have been navigating the environment and planning our business against the backdrop of dynamic macroeconomic factors,” Barry said.

Comparable sales slipped 0.7% as growth in computing, mobile phones and tablets was offset declines in home theater, appliances and drones.

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“International trade is critically important for our business and industry,” Barry said. “The consumer electronics supply chain is highly global, technical and complex.”

China continues to be a major source of merchandise, but the country at that point accounted for 30% to 35% of its offerings, compared with the 55% that it discussed in March.

“There isn’t a great single source for everything we sell, especially in consumer electronics,” Barry said. “And, obviously, quarter to quarter within categories, you’re going to see fluctuations, depending on competitive actions and tradeoff decisions.”

“I think it’s fair to say that we are going to make strategic pricing and promotional decisions depending on the environment,” she said.

After the Q1 results DA Davidson pared its price target on Best Buy to $90 from $95 and affirmed a buy rating on the shares.

Davidson said that the company’s tariff situation had greatly improved versus the concerns that hurt the stock in March and that it was likely to continue to improve with potential policy changes.

However, the firm said this was being offset by weaker comparable sales, which are heightening market-share concern as other channels seem to be showing better consumer electronics trends, according to The Fly.

Analyst cites earnings growth

Best Buy wrapped up its Black Friday event in July. Along with Target (TGT) , the company is credited with being among the first retailers to use the phrase “Black Friday in July,” as early as 2012, to promote summer sales.

The idea picked up steam with in 2015 with Amazon’s launch of Prime Day.

Piper Sandler analyst Peter Keith recently downgraded Best Buy to neutral from overweight with a price target of $75, down from $82.

While the shares have underperformed year-to-date and expectations are low, Best Buy lacks meaningful catalysts in coming quarters to meaningfully speed up comparable sales and earnings growth, Keith said.

Shares of the Richfield, Minn., retailer are down roughly 19% this year and about the same from this time in 2024.

The analyst said that he also had longer-term competitor concerns around the company’s appliance and TV categories.

Best Buy is facing competition from major players like Amazon (AMZN) and Walmart (WMT) , along with other online and brick-and-mortar retailers.

Last month, Best Buy said that Brian Tilzer, chief digital, analytics and technology officer, would be leaving the company. He’d joined in 2018. He previously served as chief digital officer at CVS Health.

Tilzer helped oversee Best Buy’s development of apps and the adoption of generative-AI integration.

He said in a LinkedIn post that “we now incorporate data, AI, and other technology into the business at levels of scale, sophistication, and impact that was unimaginable back when I joined the company in 2018.”

Best Buy recruited Walgreens (WBA) Executive Vice President and Chief Information Officer Neal Sample to succeed Tilzer.