Zacks Investment Research upgraded shares of Best Buy Company Inc. (BBY) from UNDERPERFORM to NEUTRAL on January 16, 2013, with a target price of $15.00.
We upgraded our recommendation on Best Buy to Neutral from Underperform following the company's holiday performance that showed signs of improvement. Best Buy's holiday sales were not as bad as expected with total revenue coming in at $12.8 billion, marginally down from $12.9 billion in the comparable prior-year period. Best Buy's domestic comps seem to be stabilizing with comps remaining flat and appliances, mobile phones and tablets/eReaders category generating positive comps. Moreover, domestic online sales rose 10% to $1.1 billion, reflecting increased traffic. At international segment, sales were up 2.2% to 2.9 billion, however comps declined 6.4%. Going forward, we remain concerned about secular headwinds and falling comps in televisions, gaming, notebooks and digital imaging. Additionally, Best Buy remains cash strapped with cash plunging 85.1% year over year to $309 million at the end of the last reported quarter.
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