Optimism Reigns for Best Buy? Maintaining Outperform.

4/2 - "Best Buy provided what we view as somewhat rosy, although doable expectations for 2008...There seems to be this consensus that the TV market will be Best Buy’s undoing in 2008, but two thoughts on that. First, consumer electronics already has negative comps as the company works it way out of tubes and other dinosaur-related products. Second, this company is much more than TV’s. It is about market share gains in all markets, it is over 50% of future growth coming from outside the U.S, it is growth in Best Buy mobile and other new concepts, it is growth in video games and notebooks and GPS etc, and most important it is about growth in service and installation and relationship marketing..."

"Would we have preferred slightly more conservative guidance today? Yes, but as we have seen with other retailers, BBY took their best shot at what they see...they are guiding for margins to decline 30 to 40 bps, so the glasses are not that rosy."