Investors: Best Buy Stock Could Be a Smart Choice in 2025

Best Buy Co. Inc. recently released some less-than-jolly news for investors as they reported their third-quarter earnings for the 2025 fiscal year. Unfortunately, the company fell short of expectations with earnings per share (EPS) of $1.26 and revenue of $9.45 billion, compared to analysts’ predictions of EPS of $1.30 and revenue of $9.63 billion.

This news caused BBY stock to dip even further, with a negative trend leading up to the report. Despite this, it’s important to remember that earnings reports only reflect past performance and may not accurately predict future outcomes. Many analysts have revised their price targets for BBY stock after the report, with UBS Group AG now projecting a price target of $115, offering investors a potential 29% upside.

Retail sales, a key indicator for companies like Best Buy, saw a decline in same-store sales of 2.8% for the quarter. The company also adjusted their projections for future sales, expecting a range between flat and a 3% decrease for the current quarter and a full-year decline between 2.5% and 3.5%.

CEO Corie Barry noted that consumers are focusing more on essentials and holding off on big-ticket purchases, anticipating better deals during the holiday season. This trend was reflected in an increase in foot traffic following the announcement of Black Friday deals.

While online shopping continues to grow in popularity, Best Buy’s brick-and-mortar stores still play a significant role in attracting customers. Barry mentioned during the earnings call that they have observed a return of consumers to physical stores, indicating a positive outlook for the holiday shopping season.

Despite recent challenges, there may be a silver lining for Best Buy in the form of potential tariffs on products from countries like China and Mexico. This could prompt consumers to make purchases sooner rather than later, potentially boosting sales in the short term.

Looking ahead, BBY stock presents an interesting opportunity for investors. While the stock has seen limited growth in recent years, the company’s consistent dividend payouts and potential for growth make it a compelling option. With the possibility of lower corporate tax rates under President-elect Trump, there is further potential for increased value in BBY stock.

In conclusion, Best Buy stock may not have delivered the best news this holiday season, but there are reasons to remain optimistic about its future performance in 2025. As always, it’s essential to consider the broader economic landscape and company strategies when making investment decisions.