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Best Buy will beat earnings for 12th straight quarter: Oppenheimer

Will this be the quarter that finally breaks Best Buy’s (BBY) winning streak for beating Wall Street’s earnings estimates? The electronic giant has topped expectations for 11 straight quarters.

Best Buy is set to report third quarter earnings before the bell on Thursday. Investors will be watching in anticipation to see if the retailer can top the Street’s estimates for earnings of $0.35 a share.

Brian Nagel covers the stock for Oppenheimer and thinks Best Buy will continue its upside surprise. “You have very good management running this company, and they’re controlling costs well,” he said.

It’s been a tough year for shareholders. For the year, the stock is down nearly 20 percent. The sector continues to face challenges. Big-box retailer Costco (COST) blamed a slowdown in consumer electronics for weak October sales. But Nagel doesn’t think Costco’s woes foretell Best Buy’s third-quarter results.

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“Best Buy—with its pricing, with its better relationship with its vendors—is now out there taking more market share from more marginal type consumer electronics players,” said Nagel.

The analyst also thinks the electronic retailer is gaining online. “Best Buy’s much more aggressively pricing against Amazon (AMZN), so Best Buy is not incentivizing their consumers to buy at Amazon any longer,” he said.

Despite the lack of having the “it” product for this holiday season, Nagel is bullish on Best Buy. “There are some bright spots. I don't think it's a great product cycle, [but] I think Best Buy will manage through pretty well.”

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