NEW YORK (AP) -- A Citi Investment Research analyst raised her rating and price target for Best Buy on Wednesday, saying that now appears to be a good time to purchase the stock as cost-cutting efforts and sales growth continue.
While Best Buy's stock fell following the announcement of its third-quarter results on Tuesday, analyst Kate McShane said in a note to investors that she believes the market overreacted.
McShane said that while there seems to be concern about growing pricing wars in the consumer electronics segment, Best Buy's strong quarterly earnings and 1.7 percent rise in sales at U.S. stores open at least a year were encouraging signs.
Best Buy has been cutting costs, adding employee training and matching online prices to get customers into stores as it contends with tough competition from discounters and online retailers.
"We think (the stock) pullback presents an attractive entry point for a company with a multitude of sales and cost drivers to boost earnings per share significantly over the next few years," she wrote.
McShane lifted Best Buy Co.'s rating to "Buy" from "Neutral" and increased its price target to $48 from $44.
The Minneapolis company's shares rose 53 cents to $39.31 in morning trading. The stock has more than tripled since the start of the year.