(CercleFinance.com) – Bank of America on Tuesday downgraded its advice on Best Buy stock, reduced from ‘buy’ to ‘neutral’ due to the growing uncertainty surrounding consumer spending in the United States.
According to BofA, the doubts currently surrounding the morale of American households and therefore the results of the American distributor of consumer electronics make its valuation ‘less and less attractive’.
For the analyst, the group’s performance, particularly for the next financial year 2023/2024, seems increasingly compromised by the pressures exerted on unconstrained consumption, which now sees Americans prioritizing their ‘needs’ over depends on their ‘desires’.
The intermediary recalls that the containment measures had caused a surge in sales of audio and video systems and products promoting telework over the last two years, a trend which had enabled Best Buy to generate an average growth of 9% against 1 .6% over the previous five years.
Its target price is reduced accordingly from 110 to 90 dollars.
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