‘Buy Wayfair and Best Buy Stocks,' Says Five-Star Analyst

Business Insider

2 days ago

JPMorgan analysts, led by five-star rated Christopher Horvers, believe that Best Buy (BBY) and Wayfair (W) present a good balance of risk and reward, even if they aren't among the safest retail investments. Indeed, in a research note published on Monday, the firm said that both companies are 'worth the risk' and may offer solid upside potential despite current challenges facing the retail sector. As a result, JPMorgan has Buy ratings on both stocks.
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For Best Buy, the firm is expected to see a boost in June as pre-orders for the new Nintendo Switch (NTDOY) are recognized in its financials. Furthermore, this momentum is likely to continue into July due to back-to-school shopping, especially in categories like laptops, tablets, and phones. Interestingly, though, JPMorgan noted that while tariffs have already been factored into Best Buy's guidance, there's still some risk, particularly in non-computer categories. Nevertheless, the analysts believe that the stock is attractively priced at current levels.
At the same time, Wayfair, which focuses on home goods through an online platform, is also seen as undervalued. In fact, JPMorgan believes that investors may be misjudging how tariffs will affect the company since Wayfair doesn't operate like a traditional brick-and-mortar retailer. Although its stock is trading just above $41 and is down nearly 7% in 2025, the bank suggests that there is the potential for a recovery as tariff concerns ease and sentiment improves.
Which Retail Stock Is the Better Buy?
Overall, out of the two stocks mentioned above, analysts think that BBY stock has more room to run than W. In fact, BBY's price target of $80.53 per share implies almost 18% upside versus W's 43.42%.