General Market Talk

[Singularity]

Best buy credit rating dropped to BBB which has resulted in the stock price drop on Wed

http://www.reuters.com/article/hotStocks...5S20081119

Last week, the No. 1 U.S. electronics chain slashed its profit forecast, citing "seismic changes" in consumer behavior amid a deepening economic crisis. The company said its sales at stores open at least 14 months fell about 7.6 percent in October after declining 1.3 percent in September.

Best Buy "will be more challenged than previously expected by the current weak economic environment in the U.S.," S&P Ratings Services said.

Yeah, I purchased 15 shares this past week at roughly $17/share. I think the price will continue to waffle until Feb/March, maybe even reaching a low sometime around then. If the stock goes to something ridiculous (like $10/share or less) due to low sales in the fourth quarter, i'm going to risk it and buy a bundle. Even if it doesn't fall that low, i'll probably keep buying as long as the price is below $30/share.

I really believe that two or three years from now, my portfolio will show this to have been a wise manuever. I don't really see Best Buy folding, and there is plenty of room for growth - even in the US. Add to the fact they are building in China and a few other emerging markets, I think it's worth the risk.

Two or three years from now if the the price is above $40/share, then my gamble will have paid off big time. If Best Buy stock tanks, then so what? I've lost a portion of my disposable income - nothing more.

So...let's go Best Buy! Make me happy! :wink:

EDIT:

Update:

A little over two weeks ago, I invested ~$260 (~$270 factoring in commish) in Best Buy stock. This was basically "play around" cash - nothing serious. Today, I sold that stock for ~$440 ($450/commish).