Best Buy heads into its June 12 earnings release having just delivered its biggest post-earnings surge in recent memory — and now the question is whether anything in the new print can sustain that momentum.
Short interest is meaningful but easing into the event. At 8.6% of the free float, there is a genuine short base in this name. Yet the direction has softened: shorts trimmed nearly 3% over the past week. Borrow conditions give bears little incentive to press harder — cost to borrow is a modest 0.37%, and availability has loosened sharply to over 1,000%, meaning shares to borrow are plentiful relative to what is already lent out. That is a lending market with no stress. Options positioning tells a calmer story too: the put/call ratio has pulled back to 1.04, nearly a full standard deviation below its 20-day average of 1.14, suggesting the heavy defensive hedging seen through May has largely unwound as the stock recovered.
The post-earnings relief rally explains some of that repositioning. After the previous print on May 28, BBY jumped more than 20% on the day and held roughly half those gains over the subsequent five sessions — a reaction strong enough to force a rethink across the Street. The analyst response was swift. JP Morgan, Citigroup, Truist, Evercore, and DA Davidson all raised price targets in the days that followed, though nearly all kept cautious-to-neutral ratings. The one exception to the bullish momentum came from UBS, which downgraded to Neutral even while lifting its target to $86. The consensus sits at Hold, with a mean target of $78 — modestly above the current $74 close. DA Davidson and Guggenheim are the outliers, both carrying $90 targets and Buy ratings.
The bull case rests on AI-driven hardware upgrade cycles — newer PCs and displays tied to AI-capable hardware — and gradual margin expansion from Best Buy's marketplace and advertising segments. Bears counter that the underlying revenue trend remains challenged: year-over-year sales were down 10% at the last check, and guidance pointed to a low-single-digit comp decline ahead. That tension is sharpest in the valuation: the forward PE has expanded by roughly two points over the past month as the stock re-rated on the post-earnings pop, leaving less margin for error if Thursday's comps disappoint.
The founder and Chairman Emeritus Richard Schulze sold more than $26 million in stock on May 29 — the day after the earnings pop — across multiple transactions, trimming his stake meaningfully. The timing stands out: it followed a 20% single-day gain and came just as analysts were racing to revise targets higher. That kind of opportunistic selling rarely goes unnoticed heading into a follow-on print.
Thursday's report will test whether the May surge reflected a genuine inflection in consumer electronics demand, or simply a relief rally against beaten-down expectations.
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