Although life in the electronic retailer space is getting tougher, just ask RadioShack, not all companies are throwing in the towel.
Best Buy, which remains down significantly thus far in 2014, is attempting to pull off a difficult plan for a turnaround.
Best Buy stock is off by nearly 30% to date in 2014, but is actually up over its trailing 52-week period. That shows it has had some level of success in staying afloat, although the levels of volatility have been extreme.
Best Buy said it would raise its dividend payment quarterly from 17 cents per share to 19 cents per share. That is a boost of 12% and is likely to push the stock to a 2.5% yield, which makes it an attractive payer of dividends, especially when the average of the S&P 500 index is around 2%.
Currently Best Buy stock has a hold rating by Zacks, which is up from last week’s sell rating. In addition, the consumer electronics retail industry is ranked in the top 42% making it look neutral as far as an industry choice.
There remains some promise for investors if they look to the recent estimate revisions on earnings. Many of the estimates for this year and for 2015 have moved upward, though the amount remains quite small.
At the same time, the ongoing quarter as well as the next quarter estimates are lower so it can be described as a mixed bag overall.
Best Buy however is in a quite interesting position. Its shares have not done well of late but over the long haul, there remains hope.
Estimates are saying the same thing, as the current ones remain weak, while the full year for 2014 and for 2015 is favorable.
The recent announcement of a hike in the dividend will be welcome news for investors, as it suggests that some financial strength remains with Best Buy moving forward.
