Best Buy: Understanding 'Last Man Standing' Bias

Nov. 03, 2022 1:43 PM ETBest Buy Co., Inc. (BBY)1 Comment
Harrison Schwartz profile picture
Harrison Schwartz
13.39K Followers

Summary

  • Best Buy's success over the past decade stems mainly from a loss of direct competition and not necessarily organic growth.
  • The electronics store industry remains in chronic decline, giving Best Buy significant long-term risks since it can no longer benefit from the demise of its peers.
  • The ongoing decline in real retail spending could rapidly accelerate Best Buy's difficulties as people become more price-sensitive amid falling real wages.
  • Today's economic woes may grow and be persistent since they stem from long-term supply-side difficulties as opposed to "normal" cyclical factors.
  • I believe BBY may be a short target as Q3 and Q4 holiday sales disappoint amid accelerating economic pressures.
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This article was written by

Harrison Schwartz profile picture
13.39K Followers
Harrison is a financial analyst who has been writing on Seeking Alpha since 2018 and has closely followed the market for over a decade. He has professional experience in the private equity, real estate, and economic research industry. Harrison also has an academic background in financial econometrics, economic forecasting, and global monetary economics.

Disclosure: I/we have no stock, option or similar derivative position in any of the companies mentioned, but may initiate a beneficial Short position through short-selling of the stock, or purchase of put options or similar derivatives in BBY over the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

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