BofA's downgrade comes just days after the National Retail Federation issued a disappointing forecast for back-to-school spending. Parents of K-12 students are expected to spend 7 percent less on the category, while spending on electronics for college students is forecast to drop 15 percent.
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Prosper Insights' Stacie Severs Nelson, whose firm conducts the annual survey on NRF's behalf, said that because many people upgraded their technology as the recession wound down, they have no need to buy another computer this year. What's more, whereas students used to need a watch, camera, phone and calculator, now they can purchase one single device that has all these capabilities.
The declining cost of new technology is also expected to weigh on the category, Severs Nelson said.
"That's going to impact spending in the electronics category as well," she said.
Bank of America's Chai listed "intensified competition" from Amazon as risk to Best Buy's margins. The online retailer on Wednesday held an anniversary sale that, along with cutting prices on electronics, bested its biggest Black Friday ever.
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