Deutsche Bank Has Buy Rating On Best Buy (BBY)

Deutsche Bank has a Buy rating and a $37 price target on shares of Best Buy BBY. In a note to clients, Deutsche Bank writes, "We recently spent time with Mike Vitelli, Best Buy's Co-President of the Americas. Our meetings followed Best Buy's analyst meeting a week earlier. From those two meetings, as well as our own estimates and model, we answer the 13 question sets that we posed earlier in the month. We maintain our Buy rating, acknowledging some of BBY's challenges, but balancing that with what we think are some credible strategies to address the issues, along with a compelling valuation." Deutsche Bank goes on to say, "We believe BBY's biggest challenges include too much square footage, on line competition and product cycles which are currently unfavorable. The company is taking steps to address each of these issues, including reducing square footage, improving its on line offering and developing categories where its share is currently small. Two items that we think may be surprising to some is that the economics of a tablet sale, including iPad, are better than notebook computers and that an on line sale for BBY has an operating income margin at least in line with a store sale." Shares of BBY are down 10 cents to $30.02, a loss of 0.33% this morning.