Diamond Member Pelican Press 0 Posted March 19, 2024 Diamond Member Share Posted March 19, 2024 Buy this ‘stealth’ home improvement stock as housing improves, analyst says It may not be investors’ first idea when thinking of home improvement stocks, but Loop Capital sees Best Buy as an under-the-radar pick as the housing market improves. Loop managing director Anthony Chukumba, who has a buy rating on Best Buy, sees the electronics retailer as a potential “stealth housing play.” That’s because the company’s home appliance and TV sales can benefit as the market for renovations and upgrades rebounds, he said. Data showing improved turnover in both new and existing units supports Chukumba’s optimism. He expects a further boost once mortgage rates begin falling. “We were encouraged by the latest macroeconomic data, particularly the ongoing labor market strength and the housing market ‘green shoots,'” Chukumba wrote to clients. “We believe the latter is particularly encouraging given the fact the Federal Reserve’s rate cut campaign has yet to commence, and believe Buy-rated Best Buy offers an attractive ‘derivative play’ on improved home sales given the company’s appliance and television businesses and inexpensive relative valuation.” Chukumba said home furnishing retailers like Floor & Decor , RH , and Williams-Sonoma should also benefit as the housing market improves. But he said that’s already priced into those stocks, while Best Buy trades at a much lower valuation. Best Buy trades at a 2024 price-to-earnings multiple of 12.8, while the other three stocks range from about 19 to more than 62. Best Buy shares have struggled this year, shedding about 2% and lagging far behind the rest of the market. Late last month, the Minnesota-based retailer signaled layoffs were on the horizon as it faces another year of light sales. Loop has a $93 price target on Best Buy, implying about 20% upside from Tuesday morning’s price, and roughly 11% above the Street’s consensus price target of $84. This is the hidden content, please Sign In or Sign Up Investment strategy,Stock markets,Best Buy Co Inc,Real estate,Loop Industries Inc,Williams-Sonoma Inc,Floor & Decor Holdings Inc,RH,business news #Buy #stealth #home #improvement #stock #housing #improves #analyst This is the hidden content, please Sign In or Sign Up 0 Quote Link to comment https://hopzone.eu/forums/topic/4895-buy-this-%E2%80%98stealth%E2%80%99-home-improvement-stock-as-housing-improves-analyst-says/ Share on other sites More sharing options...
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