Best Buy could cash in from rise of the metaverse, analyst says
To pick up online orders, customers wait in line outside the Best Buy Toronto store on November 23, 2020.
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Consumers and companies become more intrigued in the metaverse. Best BuyAn analyst suggests that the company could make more money by selling more VR headsets and more expensive computers.
Loop Capital Markets’ Monday research paper stated that the retailer of consumer electronics is well-placed to harness enthusiasm for virtual gaming, tokens nonfungible and other socializing tools. Anthony Chukumba is managing director of equity research firm, Equity Markets. Best Buy has the biggest PC retailer in America, with big-box shops where customers can check out various headsets. They also have a team that assists consumers with setting up.
Loop maintained his buy rating, and set the price target at $150 for Loop. This is about 52% above where Best Buy trades currently. Best Buy shares were up about 1% by midday Monday. The shares have declined by 9% in the past twelve months.
An increasing number of retailers are available from NikeYou can find more information here Ralph LaurenThey have dabbled in the metaverse. Nike bought virtual sneaker company RTFKTFor an undisclosed amount in December Ralph Lauren has experimented with ways that people can visit or shop at virtual storesGaming platforms such as RobloxZepeto.
Chukumba explained that Best Buy’s financial opportunities are even more straightforward. Customers may have to purchase additional equipment such as microphones or monitors. This could also drive an “massive computer upgrade cycle”, Chukumba said.
Loop’s opinions were formed from a conversation that Chukumba had with a CEO and venture capitalist who specialize in NFTs. Chukumba stated, “Loop” was based on Chukumba’s comments. Chukumba said that the individual has been working in the tech sector since the 1990s.
With the metaverse, two other merchandise categories — virtual reality and artificial reality devices and videogame consoles— may also gain steam, Chukumba said. Best Buy has already established relationships with major manufacturers who sell these devices. Meta(formerly called Facebook and Oculus owner) Sony Apple. Apple should soon release a VR/AR device.
Best Buy has stores that allow customers to try out and compare headsets.
Chukumba added that Best Buy might also be able to benefit from another aspect of the metaverse. This technology will make warehouse simulations more cost-effective and faster, which could lead to better ways of operating.