AG Edwards upgrades electronics retailer Best Buy (BBY) to buy from hold.
Analyst Brian Postol says he upgrades on the belief pieces are in place for on-going acceleration. Over the next four quarters, he says Best Buy will be up against much easier comparables with average same-store sales of 3.7%, vs. previous four quarters of 8.5%.
He says the company's transformation to customer-centric model is providing the foundation to further differentiate away from peers. He notes converted customer centricity stores have posted, on average, high single to low-double digit increase in comparable sales over aggregate store base.
Postol ups his $3.08 fiscal 2006 (ending February) earnings per share estimate to $3.33 and $3.64 fiscal 2007 to $3.90. He has a $78 target.