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This company just raised its dividend, but it won't help its stock: Pro

This company just raised its dividend, but it won't help its stock: Pro

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This company just raised its dividend, but it won't help its stock: Pro

This company just raised its dividend, but it won't help its stock: Pro
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Best Buy is giving a little bit more money back to shareholders.

"A little more" in this case is 2 more cents per share or a 12 percent increase in dividend for those owning stock in the electronics retailer.

That's small consolation for those who had shares since the start of the year. Best Buy is down more than $10 this year. Much of that loss came in mid-January after it reported disappointing holiday sales. But, since the start of February, Best Buy has rebounded and is up 25 percent. 

(Read: Best Buy profit beats estimates, shows signs of turnaround)

Such a rollercoaster, of course, is a familiar pattern for anyone owning Best Buy stock. In 2012, it was one of the worst-performing stocks in the S&P 500, losing close to half its value. The following year, it was up an incredible 239 percent.

Is this time different?

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For Ari Wald, head of technical analysis at Oppenheimer & Co., the technicals are saying Best Buy may not be the best buy for investors.

"It's a hold at current levels," said Wald. "It can move a little higher in the near term. But, usually the stocks I like are the ones that are pulling back to a rising 200-day moving average. Best Buy is doing the opposite thing here--it's rallying into a falling 200-day moving average."

Wald sees the 200-day moving average acting as resistance for the stock. "As you get to that 200-day moving average at around $33," he said, "I think the risk/reward becomes very unfavorable. I think it's a sell at that resistance."

(Watch: Turnaround story: Best Buy vs. RadioShack)

Gina Sanchez, founder of Chantico Global, also believes there's not much upside for Best Buy shares.

"It's hard to get behind this stock," said Sanchez, a CNBC contributor. "One of the reasons that it had that little bit of push is that they were trying to garner some extra sales by matching lowest prices out there. The problem is that in the long term, that's putting pressure on their operating margins."

In the last three years, Best Buy has seen its operating margins shrink from 4.6 percent of revenues down to 2.5 percent in the most recent fiscal year, though it was 3.8 percent for the last four reported quarters.

Sanchez sees more trouble ahead as Best Buy's rivals turn up the heat.

"They're competing against the likes of onliners, the big behemoth obviously being Amazon, who don't have bricks and mortar costs ," said Sanchez. "They're just really in an uphill battle."

To see the full discussion on Best Buy, with Wald on the technicals and Sanchez on the fundamentals, watch the above video. 

[Disclosures: Best Buy (BBY) is rated "perform" by Oppenheimer & Co.]

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