Investors Buy Large Volume of Call Options on Best Buy (NYSE:BBY)

Key Points

• Unusually heavy call buying hit Best Buy on Friday, with traders purchasing 10,054 call options, about 30% above the stock’s average daily call volume.
• Best Buy shares rose to $82.54 after the report, while the company also posted a strong quarterly earnings beat, with EPS of $1.28 versus $1.23 expected and revenue of $8.94 billion topping estimates.
• The retailer recently paid a $0.96 quarterly dividend, equal to a 4.7% annualized yield, while analysts currently hold a consensus “Hold” rating with an average target price of $79.50.

Best Buy Co., Inc. (NYSE:BBY - Get Free Report) was the recipient of unusually large options trading on Friday. Traders purchased 10,054 call options on the stock. This is an increase of approximately 30% compared to the average daily volume of 7,752 call options.

Best Buy Stock Performance

Shares of Best Buy stock traded up $2.55 on Friday, reaching $82.54. 1,600,006 shares of the stock were exchanged, compared to its average volume of 4,432,044. The company has a quick ratio of 0.40, a current ratio of 1.12 and a debt-to-equity ratio of 0.38. The business has a 50 day moving average price of $69.68 and a two-hundred day moving average price of $66.96. Best Buy has a twelve month low of $55.10 and a twelve month high of $84.99. The firm has a market capitalization of $17.40 billion, a price-to-earnings ratio of 15.30, a PEG ratio of 2.08 and a beta of 1.30.

Best Buy (NYSE:BBY - Get Free Report) last posted its earnings results on Thursday, May 28th. The technology retailer reported $1.28 earnings per share (EPS) for the quarter, beating analysts' consensus estimates of $1.23 by $0.05. Best Buy had a net margin of 2.73% and a return on equity of 48.70%. The company had revenue of $8.94 billion during the quarter, compared to the consensus estimate of $8.82 billion. During the same period in the previous year, the firm posted $1.15 earnings per share. The firm's quarterly revenue was up 1.9% on a year-over-year basis. Best Buy has set its FY 2027 guidance at 6.300-6.600 EPS. Analysts anticipate that Best Buy will post 6.56 earnings per share for the current fiscal year.

Best Buy Announces Dividend

The firm also recently declared a quarterly dividend, which was paid on Thursday, July 9th. Investors of record on Thursday, June 18th were paid a $0.96 dividend. This represents a $3.84 annualized dividend and a dividend yield of 4.7%. The ex-dividend date was Thursday, June 18th. Best Buy's payout ratio is currently 71.11%.

Analyst Upgrades and Downgrades

Several analysts have issued reports on the company. DA Davidson reissued a "buy" rating and set a $90.00 price target on shares of Best Buy in a report on Monday, June 22nd. Wall Street Zen downgraded shares of Best Buy from a "buy" rating to a "hold" rating in a report on Saturday, July 4th. Telsey Advisory Group set a $90.00 price target on shares of Best Buy and gave the stock an "outperform" rating in a research report on Friday, May 29th. Wells Fargo & Company boosted their price objective on Best Buy from $60.00 to $65.00 and gave the stock an "equal weight" rating in a research note on Thursday, May 28th. Finally, Piper Sandler restated a "neutral" rating and set a $77.00 price objective on shares of Best Buy in a report on Thursday, May 28th. Six equities research analysts have rated the stock with a Buy rating, fourteen have given a Hold rating and two have assigned a Sell rating to the company's stock. Based on data from MarketBeat, the company has a consensus rating of "Hold" and an average target price of $79.50.

Insider Activity

In related news, Chairman Richard M. Schulze sold 500,350 shares of the stock in a transaction on Friday, May 29th. The stock was sold at an average price of $76.12, for a total transaction of $38,086,642.00. Following the sale, the chairman directly owned 10,930,586 shares of the company's stock, valued at $832,036,206.32. This trade represents a 4.38% decrease in their ownership of the stock. The transaction was disclosed in a filing with the SEC, which is available at the SEC website. Also, CAO Mathew Watson sold 1,784 shares of Best Buy stock in a transaction that occurred on Friday, May 29th. The stock was sold at an average price of $73.80, for a total transaction of $131,659.20. Following the completion of the sale, the chief accounting officer owned 21,630 shares of the company's stock, valued at $1,596,294. This represents a 7.62% decrease in their ownership of the stock. The SEC filing for this sale provides additional information. Insiders sold 1,002,134 shares of company stock valued at $77,283,527 over the last ninety days. Corporate insiders own 0.50% of the company's stock.

Institutional Investors Weigh In On Best Buy

A number of large investors have recently modified their holdings of BBY. Concurrent Investment Advisors LLC raised its position in shares of Best Buy by 100.6% during the 4th quarter. Concurrent Investment Advisors LLC now owns 70,280 shares of the technology retailer's stock valued at $4,704,000 after buying an additional 35,239 shares during the period. PFA Pension Forsikringsaktieselskab purchased a new stake in Best Buy during the fourth quarter worth about $1,741,000. VIRGINIA RETIREMENT SYSTEMS ET Al increased its stake in Best Buy by 42.9% during the 4th quarter. VIRGINIA RETIREMENT SYSTEMS ET Al now owns 225,000 shares of the technology retailer's stock worth $15,059,000 after buying an additional 67,600 shares during the period. Oxbow Advisors LLC acquired a new stake in shares of Best Buy in the fourth quarter valued at $6,295,000. Finally, Trust Investment Advisors purchased a new position in shares of Best Buy in the 3rd quarter valued at about $1,939,000. Hedge funds and other institutional investors own 80.96% of the company's stock.

Best Buy Company Profile

Best Buy Co, Inc is a leading North American consumer electronics retailer that sells a broad range of products including computers, mobile phones, televisions and home theater systems, major appliances, smart-home devices, gaming hardware and software, wearables and related accessories. The company operates through a mix of large-format stores, smaller specialty locations and an e-commerce platform, offering national and private-brand merchandise from major consumer-technology manufacturers as well as third-party sellers.

Beyond product retailing, Best Buy provides a suite of services aimed at installation, repair and ongoing technical support.

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