Best Buy has been downgraded to neutral from “buy” by Goldman Sachs on concerns that Amazon.com and Walmart are poised to begin a serious asskicking.

From MarketWatch:

Best Buy’s “confronting a new set of strategic challenges from its perch as the dominant specialty retailer of electronics in the U.S.,” the analyst said. It’s “confronting them from a position of strength, in terms of market share, talent, and balance sheet, but they remain thorny nonetheless.”

This is Wall Street for “LOL, people are going to “shop” at Best Buy and buy at Walmart (which is upgrading its electronics offerings) or Amazon.com.”

Best Buy is facing declining music and DVD sales and a “maturing video game cycle.” Flat panel TVs are cheaper and less profitable. In Best Buy’s favor is the fact that their main competitor, Circuit City, died a violent, public death and has only recently sort of risen from the ashes. All in all, it’s a fun time to be in retail, no?

Retail stocks drop as Best Buy downgraded from buy rating [MarketWatch]
(Photo:penner42)

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