Apple Inc. (NASDAQ:AAPL) iPhone 6 could play savior to the struggling retailer Best Buy Co Inc (NYSE:BBY), who could be one of the biggest winners from the record-smashing sales of the iPhone 6, says a report from CNN. Apple has already sold 10 million new phones since they went on sale on Friday. The newest iPhone seems to be the perfect gift for e-retailer and its investors.
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According to analyst Alan Rifkin of Barclays, Best Buy will be the biggest “non-Apple retail beneficiary,” and added, “The launch comes at a very opportune time with the holiday season fast approaching.” Back in May, when the smartphone industry was buzzing with the iPhone 6 rumors, Best Buy stated that the sales of smartphone has declined as consumers are eagerly awaiting for the product launches ahead.
The wait it seems is over as Barclays expect Best Buy to witness a 2% to 2.5% rise in the mobile sales this quarter, primarily due to the iPhone 6. The big-screen iPhone 6 will probably attract more buyers to the brick and mortar retailers like Best Buy. Also, more traffic would benefit other segments of the Best Buy, helping to maintain a positive trend ahead of the holiday season, believe analysts. Barclays have raised the price target on Best Buy to $40 from $35.
Will Best Buy capitalize iPhone 6 buzz?
However, there is no surety that the retailer will be able to capitalize on the iPhone 6 opportunity. Even though Barclays advice investors to own the stock, the sales for the second half of the year is expected to decline by 2%. But if we go by the trend, the retailer does enjoy the iPhone company, like during the iPhone 5S/5C launch last September, the domestic mobile sales for Best Buy was up 6.7%. The retailer does share a cordial relationship with Apple even though it does not support the new mobile payment system from the iPhone maker.
Year to date, Best Buy shares are down almost 14%, but have gained 8% in September thanks to the iPhone 6 buzz. Best Buy is not the only company to benefit from the iPhone 6 popularity. Avago Technologies (NASDAQ:AVGO), Skyworks Solutions (NASDAQ:SWKS) and NXP Semiconductors (NASDAQ:NXPI)