• BBY stock jumps more than 3% after earnings.
  • The retail company's revenue was better than analysts expected.
  • Best Buy's full-year outlook was reduced.

Best Buy (BBY) stock is up 3.3% at $75 in the first half hour of Tuesday's session after the retailer reported better-than-anticipated sales figures. Adjusted earnings per share (EPS) came in at $1.57, a penny up on Wall Street consensus. More importantly revenue of $10.65 billion beat forecasts by $220 million. 

Also read: SNAP craters 31% after announcing revenue slowdown

The retail sector has been in a slump of late after both Target (TGT) and Walmart (WMT) posted discouraging quarters and forecast a slowdown in their respective businesses. In both cases, management blamed expanding inflation and injured supply chains for affecting their bottom lines, and both companies said inflation was causing consumers to reduce spending.

Both revenue and same store sales at Best Buy dropped 8.5% YoY, but the market has mostly ignored this since analysts were expecting worse figures and BBY stock had already sunk below $70 last week in the wake of the retail sector's major rout caused by Walmart and Target. There always is a benefit to reporting late.

The negative aspect of the report was Best Buy reducing its full-year outlook. However, this failed to move the stock as a negative outlook is now baked into nearly every retail stock. For the full fiscal year, Best Buy reduced its revenue forecast midpoint from $50.05 billion to $49.1 billion. Management now expects adjusted EPS at $8.70 compared to the previous forecast of $9.

Best Buy Stock Forecast: BBY bulls eye gap-closing at $82

BBY stock is presently trading above the 9-day moving average at $72.80. In the premarket, BBY briefly touched the 20-day moving average at $79.47. This moving average is the immediate target, but BBY will likely remain between these two averages for this week as it builds out a base. Ultimately the bulls' goal is to close the May 18 gap down by testing $82.

That is unlikely to happen until a general market turnaround is in the works. With the S&P 500 down 1.3% and the Nasdaq down 3.4%, there is not enough optimism for a push higher at present. Bulls should watch out if BBY share price drops back below the 9-day moving average. In that case it is time to escape.

BBY 4-hour chart

Like this article? Help us with some feedback by answering this survey:

Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.

If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.

FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.

The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.

Feed news Join Telegram

Recommended content

Recommended content

Editors’ Picks

AUD/USD struggling to retain the 0.6900 mark

AUD/USD struggling to retain the 0.6900 mark

Wall Street plunged on Tuesday, dragging AUD/USD lower as the greenback benefited from the risk-averse sentiment. Softening gold prices weighed further on the aussie, now approaching its June lows. Australian Retail Sales in the docket.


EUR/USD nears 1.0500 amid inflation and recession concerns

EUR/USD nears 1.0500 amid inflation and recession concerns

The EUR/USD pair bounced modestly from a Tuesday’s low of 1.0502, maintaining a near-term bearish bias amid concerns related to economic growth and central banks’ actions to tame inflation. US core PCE inflation and German CPI coming up next.


Gold: Can the dollar finally win the battle?

Gold: Can the dollar finally win the battle?

XAUUSD is technically bearish and could soon lose the $1,800 level. Gold retains the sour tone on Tuesday, now trading at around $1,823.00 a troy ounce. The dollar seesawed between gains and losses, turning higher after the release of discouraging US data.

Gold News

Summertime bull-run a multi-year bear market?

Summertime bull-run a multi-year bear market?

The cryptocurrency market is in a historical pivotal moment. One good trade could replenish all losses, while one bad trade could be catastrophic.

Read more

FXStreet Premium users exceed expectations

FXStreet Premium users exceed expectations

Tap into our 20 years Forex trading experience and get ahead of the markets. Maximize our actionable content, be part of our community, and chat with our experts. Join FXStreet Premium today!