It wasn't long ago when Best Buy (BBY) was believed to be on its way out and join forces with the likes of Circuit City. That was roughly one year ago after the company reported dismal earnings as well as a -4% decline in same store sales (found here) which took the stock down -13% in a single day! Who would have imagined that such an event would be marked as the most opportune time to buy the stock.
Since then, the stock has risen from $12 to the most peak at $44. That equates to +265% gain in just one year. While hindsight is 20/20, it's always good to look back at the sentiment when the stock make a new low. This Forbes' article provides a great deal of insight into analyst sentiment. According to Factset, 4% of of the analysts rated the stock as a "buy" or "outperform" at the low. That number have risen to 58% today.
In addition to having a strong heart and being a true believer in the company's turnaround plan, one would need just a tiny bit of luck to capture the stock at the low. Our observations, however, has shown that any stocks worth investing should be accumulated at or near the low.
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