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Investors who owned stocks in the 2010s generally experienced some big gains. In fact, the SPDR S&P 500 (NYSE: SPY) total return for the decade was 250.5%. But there’s no question some big-name stocks did much better than others along the way.
Best Buy’s Big Decade: One of the market leaders of the past decade was consumer electronics retailer Best Buy Co Inc (NYSE: BBY).
The 2010s were a transformative decade for the retail sector and the electronics business in general. Amazon.com, Inc. (NASDAQ: AMZN) applied major pressure to a large portion of the retail sector, and Best Buy was no exception. In fact, Best Buy’s largest competitor Circuit City didn’t even survive the financial crisis, declaring bankruptcy in late 2008.
Fortunately for Best Buy investors, the company was a lot more aggressive in shifting its sales model online and adapting to the rapidly evolving landscape.
In 2012, Best Buy launched a “transformation strategy” that focused more on services, such as its Geek Squad desk. In the second quarter of 2014, Best Buy reported its 10th consecutive quarter of declining revenue and announced it would be focusing more on digital media advertising and online sales. The company has also increased its dividend each year since 2014 as well.
Starting with the second quarter of 2016, Best Buy reported positive revenue growth in nine out of the next 10 quarters, suggesting its transformation efforts were paying off.
Best Buy shares started the 2010s trading at around $40. The stock made it as high as $48.83 in mid-2010 before starting a multi-year downturn. That sell-off took Best Buy shares all the way down to $11.20 in late 2012, a price which would mark its low point of the decade. The following year was a big year for Best Buy on turnaround optimism, but the stock wouldn’t break out to new decade highs until 2017.
Best Buy climbed as high as $84.37 in late 2018 but the company ended the year on a low note on concerns it wouldn’t be able to repeat its sales growth performance in 2019. Fortunately for investors, Best Buy proved its doubters wrong in 2019, and the stock made it as high as $91.99 in early 2020 prior to the market’s pandemic sell-off.
2020 And Beyond: Like the rest of the market, Best Buy took a hit in March 2020. However, its 2020 low point of $49.01 was roughly in-line with its low point during the 2018 sell-off.
Best Buy has since rebounded as high as $124.89, making the stock one of the best performers in the retail sector this year and among the top performers of the past decade as well. In fact, $1,000 worth of Best Buy stock in 2010 would be worth about $3,636 today, assuming reinvested dividends.
Looking ahead, analysts expect Best Buy to continue to drift higher in the next 12 months. The average price Best Buy among the 24 analysts covering the stock is $124.50, suggesting 2.6% upside from current levels.
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