Best Buy Stock Breaking Past Pressure After Upgrade

Today's pop has BBY breaking past pressure at several short-term moving averages

Assistant Editor
Feb 4, 2021 at 2:26 PM
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The shares of Best Buy Co Inc (NYSE:BBY) are up 3.4% at $114.08 at last check, after an upgrade from BofA Global Research to "buy" from "neutral." With all of the recent volatility, the firm decided to "step back and focus on the fundamentals and to highlight high-quality stocks," one of which is Best Buy stock, as the analyst in coverage sees steady growth ahead for the company. 

After bouncing off the 160-day moving average at the start of the month, today's pop has BBY breaking past several long- and short-term moving averages, including its 20-day. On track for its third-straight day of gains, the equity is up 14.1% so far in 2021.

BBY Feb 4

On the analyst front, nine of the 16 in coverage carry a "strong buy" rating on Best Buy stock, with the remaining seven at a tepid "hold." Meanwhile, the 12-month consensus price target of $121.94 is a 6.9% premium to current levels.

Over in the options pits, traders have been particularly bullish in the last 10 weeks. This is per BBY's 50-day call/put volume ratio of 2.07 at the International Securities Exchange (ISE), Cboe Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX). This ratio stands higher than 91% of readings from the past year, showing a strong penchant for long calls. 

That said, speculating on BBY's next move with options could be a prudent play. The stock's Schaeffer's Volatility Index (SVI) of 34% stands higher than just 9% of all other readings in its annual range, implying that options players are pricing in low volatility expectations at the moment. 

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