Best Buy shares tumbled in late November. Chairman J. Patrick Doyle bought $2 million of shares of the consumer-electronics retailer.
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B stock plunged after the consumer-electronics retailer reported a strong fiscal third quarter. Soon after, Chairman J. Patrick Doyle bought up Best Buy stock.
Best Buy (ticker: BBY) stock rose to a record high of $141.97 on Nov. 22, just ahead of the company’s earnings report the next morning. But despite a strong report, shares tanked, possibly due to disappointment with the thinner gross margin.
Doyle paid $2.1 million on Dec. 3 for 20,000 Best Buy shares, a per share average price of $104.47. According to a form he filed with the Securities and Exchange Commission, Doyle now owns 51,856 shares, mostly from grants of restricted stock units from his service to the board.
Best Buy didn’t respond to a request to make Doyle available for comment on his stock purchase. Doyle, who joined Best Buy’s board last year, is an executive partner at investment firm Carlyle Group and a former CEO of Domino’s Pizza (DPZ).
Oppenheimer analyst Brian Nagel wrote after Best Buy’s third-quarter report that there were already “market concerns of waning sales and profit growth.” Nagel, who rates the stock at Perform with no price target, recommends that investors “remain on the sidelines with Best Buy, at least for now.”
Doyle’s stock purchase is the first on the open market by a Best Buy insider since October 2012, when then-director Matthew Paull paid $110,000 for 6,500 shares, a per share average price of $16.89. Paull, a former chief financial officer of McDonald’s (MCD), left Best Buy’s board in 2013.
Inside Scoop is a regular Barron’s feature covering stock transactions by corporate executives and board members—so-called insiders—as well as large shareholders, politicians, and other prominent figures. Due to their insider status, these investors are required to disclose stock trades with the Securities and Exchange Commission or other regulatory groups.
Write to Ed Lin at [email protected] and follow @BarronsEdLin.
