Best Buy ranked ‘buy’ by Barclays
Best Buy raised its dividend last week, boosting the quarterly payout by 12 percent to 19 cents per share. CEO Hubert Joly told shareholders at the big-box retailer’s annual meeting Tuesday that the first year of the company’s turnaround plan has been effective.
Best Buy is, so far, exceeding its goal for cost-cutting and finding $860 million in savings. It’s also using those cuts to offset expenses such as a price matching, which Best Buy has vowed to continue in its bid to stay competitive against the likes of Amazon and other online retailers.
Alan Rifkin, an analyst for Barclays PLC in New York, liked what he heard from Joly.
“We see it as a strong indicator that management is increasingly confident about the trajectory of the company’s ongoing recovery,” Rifkin wrote in a note to clients. Provided stabilization continues, “Best Buy will be well-positioned to begin repurchasing shares by early 2015.” Of the 28 analysts who cover Best Buy, 16 have “buy’’ recommendations, including Rifkin.
Sale of SVU retail ‘realistic’
Citing meetings with Supervalu management, Deutsche Bank analyst Karen Short said in a note last week that sales of Supervalu’s retail operations, which would include Cub Foods, and a possible spinoff of its ultra-discount chain Save-A-Lot are “realistic’’ possibilities.
Short said that among the SVU’s three divisions (wholesales, retail and Save-A-Lot) top management seems “much less-enthused with retail.’’
John J. Oslund