We recently published a list of 11 Best Consumer Electronics Stocks to Invest in Now. In this article, we are going to take a look at where Best Buy Co., Inc. (NYSE:BBY) stands against other best consumer electronics stocks to invest in now.
The global consumer electronics market has seen significant growth, reaching a valuation of $755 billion in 2024, with projections to hit $1.15 trillion by 2031, according to Research and Markets. This growth is driven by rising demand for innovative devices that enhance convenience. Consumer electronics, including smartphones, tablets, smartwatches, and connected home devices, have transformed how people live, work, and connect.
Continuous innovation also keeps the industry competitive, with companies focused on attracting consumer interest. Despite global economic challenges, the market remains resilient, driven by advancements in AI. In 2023, smartphone shipments reached about 1.2 billion units, reinforcing this category’s profitability. The market is projected to grow to $1.13 trillion by 2025, with a 3% annual growth rate. North America, particularly the US, is at the forefront of the consumer electronics market, leading globally in terms of adoption and demand. The region is expected to maintain this leadership due to its swift embrace of cutting-edge technologies. In the US, the fast-paced lifestyle increasingly revolves around digital solutions, with automation becoming a key priority.
Tim Seymour, Seymour Asset Management CIO, appeared on CNBC’s ‘The Exchange’ on January 18 to signify upcoming events and how they might correlate with current market dynamics. Seymour notes that the tech sector, which includes consumer electronics, has rallied under President Trump, creating a favorable hiring environment. He believes that at least half of the MAG7 stocks have defensible valuations. Regarding tariffs, he suggests that consumer-centered sectors, like consumer electronics, will be impacted first, with reports indicating that tariffs could negatively affect the economy, as highlighted by the World Bank and IMF.
Discussing the economic implications of tariffs, Seymour expressed skepticism about tax increases while acknowledging uncertainty around reductions. He reflected on the tariffs imposed against China in 2018 and 2019, which impacted manufacturing, including consumer electronics. While tariffs may hinder growth, he noted that a strong dollar could enhance the competitiveness of US products abroad. Seymour focused on tech companies with solid valuations for their growth potential. Large MNCs in consumer electronics may perform better with upcoming announcements and are less vulnerable to strategic influences than smaller firms. While he is cautious about growth scares overshadowing inflationary pressures in 2025, he maintains a positive sentiment overall.
Methodology
We first sifted through ETFs, online rankings, and internet lists to compile a list of the top consumer electronics stocks. We then selected the 11 stocks that were the most popular among elite hedge funds and that analysts were bullish on. The stocks are ranked in ascending order of the number of hedge funds that have stakes in them, as of Q3 2024. The hedge fund data was sourced from Insider Monkey’s database which tracks the moves of over 900 elite money managers.
Why are we interested in the stocks that hedge funds pile into? The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 275% since May 2014, beating its benchmark by 150 percentage points (see more details here).
A busy retail store showcasing a wide range of consumer electronics.
Best Buy Co., Inc. (NYSE:BBY)
Number of Hedge Fund Holders: 37
Best Buy Co., Inc. (NYSE:BBY) is an electronics retailer in the US and Canada that offers a vast selection of technology products and services to meet home entertainment and tech needs. From laptops and smartphones to TVs and smart home devices, it provides a one-stop shop for everything that is needed to stay connected, informed, and entertained. It also offers a variety of appliances, entertainment products, and services like installation, repair, and technical support.
The company’s overall Q3 2025 sales declined. Comparable sales for the domestic segment, which includes consumer electronics, decreased by 2.8% year-over-year. However, there were some bright spots, such as the computing and tablets category. These experienced a 5.2% increase in comparable sales, with laptops leading the way at 7% growth.
The sales decline was the result of macroeconomic uncertainty, customer anticipation for significant sales, and distractions during the election period. Despite these challenges, Best Buy (NYSE:BBY) remains optimistic and is focusing on offering compelling deals. These include initiatives like the “Best Buy Gift Finder,” and improving store environments with refreshed layouts and dedicated staff. The company is prioritizing operational efficiency by using AI and technology to optimize logistics, improve customer support, and streamline operations.
On January 22, Morgan Stanley analyst Simeon Gutman lowered the firm’s price target on the company to $100 from $105 while maintaining an Equal Weight rating. Gutman favors hardline and broadline retailers that use scale for next-generation retail technology. He prefers those with revenue upside, market share leadership within their sub-segments, or those capitalizing on cyclical category inflections in 2025.
Mairs & Power Growth Fund initiated a position in Best Buy Co., Inc. (NYSE:BBY). The firm recognized its market share gains despite the challenging retail environment and appreciated its 5% dividend yield. It stated the following regarding the company in its Q4 2023 investor letter:
“We added two smaller positions to the portfolio in the fourth quarter as well—Piper Sandler (PIPR) and Best Buy Co., Inc. (NYSE:BBY)–both of which are Minnesota-based. We also initiated a position in Best Buy, a leading electronics retailer with more than 1,000 stores nationwide. We’ve been impressed with management’s ability to navigate a difficult retail landscape, gaining share amongst its offline competitors. The consumer electronics market is suffering from a spending hangover after the Pandemic, but we are starting to see green shoots of a recovery; in the meantime, Best Buy offers a 5% dividend.”
Overall, BBY ranks 2nd on our list of best consumer electronics stocks to invest in now. As we acknowledge the growth potential of BBY, our conviction lies in the belief that AI stocks hold great promise for delivering high returns and doing so within a shorter time frame. If you are looking for an AI stock that is more promising than BBY but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
READ NEXT: 20 Best AI Stocks To Buy Now and Complete List of 59 AI Companies Under $2 Billion in Market Cap
Disclosure: None. This article is originally published at Insider Monkey.
