The JB Hi-Fi Limited (ASX: JBH) share price is trading lower on Friday afternoon.
At the time of writing, the retail giant's shares are down 2.5% to $44.46.
This latest decline means that JB Hi-Fi's shares are now down 20% from their 52-week high.
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Is the JB Hi-Fi share price in the buy zone now?
Despite the recent pullback in the JB Hi-Fi share price, the team at Goldman Sachs continue to sit on the fence with it.
According to a note out of the investment bank this week, its analysts have retained their neutral rating and lifted their price target slightly to $49.80.
Though, it is worth noting that despite its neutral rating, its price target implies some strong potential returns.
Based on the current JB Hi-Fi share price, Goldman's price target suggests there's potential upside of 12% over the next 12 months.
And that's before dividends. If you include the $2.20 per share fully franked dividend the broker is forecasting in FY 2022, the potential return increases to approximately 17%. Not bad for a neutral rating.
What did the broker say?
Goldman has an issue with the valuation of the JB Hi-Fi share price and believes its positive outlook is largely priced in.
It commented: "While our forecasts for JBH imply a strong outlook of +6.5% EBIT CAGR over FY19-24e, we believe this is largely priced into the valuation."
"The strong outlook remains largely priced in with the stock currently trading at c. 13.6x, a 1.6x premium to HVN and well ahead of peer group median of 9.6x," Goldman added.
In light of this, the broker has a preference for Harvey Norman Holdings Limited (ASX: HVN) at present.
So much so, this week the broker upgraded its shares to a buy rating with an improved price target of $6.00. This implies potential upside of 21% over the next 12 months.
