Credit Suisse: Best Buy's Results Better Than Expected With 'More To Go'

reported its third quarter results Thursday morning which impressed investors as shares soared more than eight percent. Gary Balter of Credit Suisse is among those who were impressed by the company's results. The analyst reiterated an Outperform rating with a price target raised to $45 from a previous $40 following the earnings report. “We continue to view Best Buy as one of our favorite stocks in our coverage universe and believe that today's Q3 results were just another indication that this turnaround is happening,” Balter wrote. The analyst adds that there are “significant opportunities” to drive further improvements in the fourth quarter and into 2015. Balter states that Best Buy is still trading at one of the lowest multiples among retailers under his coverage and has “some of the best” upside potential expectations among retailers. Looking forward to 2015, Balter believes that management will announce a buyback program or increase its dividends as free cash flow improves “materially” and cash continue to accumulate on the balance sheets. Due to a strong optimism surrounding the company's fourth quarter, the analyst is now projecting the company to earn $2.23 per share in fiscal 2014, $2.43 in fiscal 2015 and $2.49 in fiscal 2016.