JB Hi-Fi Limited shares storm higher on broker upgrade

One of the best performers on the market today has been the JB Hi-Fi Limited (ASX: JBH) share price.

In morning trade the retailer’s shares are up 4.5% to $27.99 despite the market sinking notably lower.

Why are its shares higher today?

With no news out of the company, today’s gain is likely to be attributable to the release of a positive broker note out of investment bank Morgan Stanley.

According to the note, the broker has upgraded JB Hi-Fi to an overweight rating and placed it into its model portfolio in place of Aconex Ltd (ASX: ACX), which is currently subject to a takeover offer from Oracle.

Furthermore, the broker has lifted its price target on the company’s shares to a lofty $32.00. Even after today’s strong gain this still implies potential upside of over 14% for its shares.

Its analysts have made the move on “the expectation of solid trading and upside to earnings post-interim results”.

Investors appear to think that rival Harvey Norman Holdings Limited (ASX: HVN) may also be in the same boat. Its shares have managed to push higher today as well.

Should you buy JB Hi-Fi?

While JB Hi-Fi may provide some short-term gains if Christmas trading proves to be better than first feared, I certainly wouldn’t be a long-term holder of its shares.

The Amazon launch may have underwhelmed, but it is still very early days. The Australian site currently only has a fraction of the products available on its US site and lacks the popular Amazon Prime option.

But Amazon Prime is coming soon and I think Amazon’s assortment will grow significantly over the next couple of years. This could prove to be a big challenge for JB Hi-Fi and not one I’m willing to go along for the ride with.

Whereas these three growth shares could provide strong returns for shareholders over the long-term in my opinion.

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