From Outstanding To Talented: Morgan Stanley On Best Buy's CEO Shuffle
Best Buy Co Inc (NYSE: BBY) said Monday CFO Corie Barry will transition to the CEO role and replace Hubert Joly in what should be a "smooth transition," according to Morgan Stanley.
The Analyst
Morgan Stanley's Simeon Gutman maintains an Equal-weight rating on Best Buy with a $77 price target.
The Thesis
Best Buy is replacing an "outstanding" CEO in Joly with Barry who has proven herself to be a "talented executive," Gutman said in a research report. Joly succeeded in leading Best Buy's transformation to become a "premier and highly relevant" retailer and Barry certainly played a role in the transformation over the years.
Joly will remain a part of Best Buy's team as Executive Chairman of the board of directors. The transition should be painless, according to Gutman, and the timing of the CEO change "makes sense" as the company is entering a new phase after a successful turnaround.
Under Barry's leadership, the company is likely to focus on health care and other potential revenue and service streams. The 2018 acquisition of Great Call could foreshadow a strong push into the growing technology-enabled aged care space over time.
Best Buy's Fall 2019 analyst day presentation could include a favorable update on financial targets instead of a "step-back" in the medium to long-term margin trajectory of the business.
Price Action
Shares of Best Buy traded around $73.24 Tuesday afternoon.
Related Links:
Oppenheimer: Buy Best Buy's Stock
Best Buy Analyst Says Progressive Leasing Partnership Could Boost Sales
Photo courtesy of Best Buy.
Latest Ratings for BBY
Mar 2019 | Oppenheimer | Upgrades | Perform | Outperform |
Mar 2019 | Evercore ISI Group | Initiates Coverage On | In-Line | |
Mar 2019 | Citigroup | Maintains | Neutral | Neutral |
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