NEW YORK, NY / ACCESSWIRE / August 30, 2017 / Best Buy and Finish Line both dragged into the red on Tuesday with Finish Line even hitting a brand new low. Finish Line's second quarter results were dismal and a slashed guidance didn't keep traders optimistic. Best Buy's second quarter results, on the other hand, were impressive but the stock closed down nearly 12% anyway on what could have been traders running away with profits.

RDI Initiates Coverage on:

Best Buy Co Inc.
https://rdinvesting.com/news/?ticker=BBY

Finish Line Inc.
https://rdinvesting.com/news/?ticker=FINL

Best Buy Co., Inc.'s shares closed down 11.93% on Tuesday on nearly 35 million shares traded. The stock was one of the biggest losers on the S&P 500 yesterday after what two analysts believe was traders taking profits. The company reported 2nd quarter financial results yesterday that beat the Street's estimates. Earnings, adjusted for one-time gains and costs, were 69 cents per share which was ahead of the 63 cents the Street was waiting for. Analysts David Magee and D. Mitch Van Zelfden of SunTrust Robinson Humphrey remarked, "BBY is trading down after showing impressive 2Q beat/raise results. We think the weakness has come from profit taking, prompted by the discussion of higher investments?with the implication that '18 could be a flatter year. It sounds like sales will be a bigger driver of profits ahead. We believe the stock is being overdone as BBY has a recent history of driving share growth, while reducing the cost structure/managing investments (and the current focus on service is promising). Note that we're not lifting '18 for this reason, but we continue to be bullish over a 3-year time period. Buy."

Access RDI's Best Buy Co Inc. Research Report at:
https://rdinvesting.com/news/?ticker=BBY

The Finish Line, Inc. dropped deep into the red on Tuesday with shares closing down 18.43%. The stock even hit a new 52-week low of $6.90 and were down as much as 33.8% during the trading day yesterday. Second quarter financial results had traders less than impressed with net sales dropping 3.3% to the year ago quarter. Comparable-store sales also dropped 4.6%. The outlook looking ahead was also disappointing as the company now expects EPS of $0.08 to $0.12 for the third quarter and adjusted earnings for the full year in the range of $0.50 to $0.60. The guidance for the full year was cut more than half. CEO Sam Sato commented, "The marketplace for athletic footwear became much more promotional as our second quarter progressed resulting in challenging sales and gross margin trends." The biggest reason why shares may have dropped as much as they did yesterday was because the company announced it has adopted the "poison pill" plan. This is a shareholder-rights plan that prevents any shareholder or group from getting 12.5% or more of the company's stock. Volume was significant yesterday with a little over 26 million shares traded compared to an average of around 1.6 million shares.

Access RDI's Finish Line Inc. Research Report at:
https://rdinvesting.com/news/?ticker=FINL

Our Actionable Research on Best Buy Co Inc. (NYSE:BBY) and Finish Line Inc. (NASDAQ:FINL) can be downloaded free of charge at Research Driven Investing.

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SOURCE: RDInvesting.com