Manufacturers, such as Apple and Samsung, and wireless carriers including AT&T and Verizon Wireless, have intensified Best Buy's competition as they develop their own retail channels. As a result, they rely less on Best Buy as a distributor.
"You are still seeing distribution through Best Buy, but over the next couple of years, there is less and less incentive to go through this channel," he said.
Although Best Buy stock plummeted following the restructuring and guidance announcement, Hottovy does not plan on changing his $16 fair value estimate right now, even though the preliminary results "fell well short of our already pessimistic expectations and consensus expectations."
Morningstar analysts plan to wait until the company's analyst and investor event Nov. 1 to make any possible changes to their estimates.
Founder and former chairman Richard Schulze's efforts to take the company private also loom over Best Buy's restructuring efforts. In early October, a report indicated that Schulze and at least four private-equity firms have began examining the company's financials.
"While equity funding commitments remain the key question in bringing a formal offer to the board, we are starting to believe that current shareholders may be more receptive to Schulze's previously disclosed offer of $24 to $26 per share than we previously believed, based on the disappointing third-quarter results and today's sell-off," the report said.
—By CNBC.com's Katie Little; Follow her on Twitter @katie_little
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R.J. Hottovy does not own shares of Best Buy.