Best Buy (NYSE:BBY) stock edged down late last week, as a bit of uncertainty tempered its recent momentum. The dip came even after a solid Q2 FY 2026, when the company topped expectations on both revenue and earnings.
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Indeed, the company’s revenue was $9.44 billion, a beat by $205.86 million, while its EPS of $1.28 surpassed estimates by $0.06. Still, investors were rattled when management chose to maintain prior guidance, with CEO Corie Barry pointing to “the uncertainty of potential tariff impacts.”
That cautionary note was enough to spark mid-single-digit losses in the hours that followed. Even so, after a rough start to 2025, Best Buy has regained its footing, with the stock climbing 13% in August.
It’s this rebound, coupled with strong fundamentals, that has Goldman Sachs analyst Kate McShane convinced the company is headed in the right direction.
“We reiterate our Buy rating based on improving demand fundamentals which should only get stronger as the company continues to execute on new strategies like marketplace and the housing market starts to recover,” McShane wrote.
McShane emphasizes that Q2 was not just solid overall but also showed standout strength in Entertainment, where revenues surged 38% thanks to robust Nintendo Switch sales. Beyond the quarter, the analyst highlights management’s confidence in meeting the upper end of FY 2026 sales guidance.
Further, McShane sees vendor partnerships with Meta, Microsoft, and Nintendo as important growth levers, noting that these collaborations contributed to the 1.6% year-over-year sales increase.
Adding another growth driver, McShane points to Best Buy’s newly launched vendor Marketplace. With six times more product options online, the platform integrates seamlessly into the company’s ecosystem by enabling store associates to connect customers with a much broader range of products.
“Management noted that they expect Marketplace to have a positive impact on operating income margin in 2026 and over time to drive profit dollars and unit share,” the analyst explains.
All told, McShane sees multiple tailwinds converging for Best Buy. The Goldman Sachs analyst not only reiterated her Buy rating but also lifted her price target to $95 – the Street’s most bullish forecast – implying nearly 30% upside. (To watch Kate McShane’s track record, click here)
What does the rest of the Street think? Looking at the consensus breakdown, opinions from other analysts are more spread out. 8 Buys, 11 Holds and 1 Sell add up to a Moderate Buy consensus. In addition, the $79.83 average price target indicates an 8% upside potential from current levels. (See BBY stock forecast)
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Disclaimer: The opinions expressed in this article are solely those of the featured analyst. The content is intended to be used for informational purposes only. It is very important to do your own analysis before making any investment.