Is NYSE:BBY suited for dividend investing?

Our stock screener has singled out BEST BUY CO INC (NYSE:BBY) as a promising choice for dividend investors. NYSE:BBY not only scores well in profitability, solvency, and liquidity but also offers a decent dividend. We'll explore this further.

Evaluating Dividend: NYSE:BBY

ChartMill assigns a Dividend Rating to every stock. This score ranges from 0 to 10 and evaluates the different dividend aspects, including the yield, the growth and sustainability. NYSE:BBY scores a 7 out of 10:

• With a Yearly Dividend Yield of 5.23%, BBY is a good candidate for dividend investing.
• BBY's Dividend Yield is rather good when compared to the industry average which is at 5.00. BBY pays more dividend than 92.42% of the companies in the same industry.
• Compared to an average S&P500 Dividend Yield of 2.72, BBY pays a better dividend.
• The dividend of BBY is nicely growing with an annual growth rate of 20.80%!
• BBY has paid a dividend for at least 10 years, which is a reliable track record.
• BBY has not decreased its dividend in the past 5 years, so it has a somewhat stable track record.

Understanding NYSE:BBY's Health Score

ChartMill employs a unique Health Rating system for all stocks. This rating, ranging from 0 to 10, is determined by analyzing various liquidity and solvency ratios. For NYSE:BBY, the assigned 6 for health provides valuable insights:

• An Altman-Z score of 4.22 indicates that BBY is not in any danger for bankruptcy at the moment.
• Looking at the Altman-Z score, with a value of 4.22, BBY belongs to the top of the industry, outperforming 84.85% of the companies in the same industry.
• BBY has a debt to FCF ratio of 0.63. This is a very positive value and a sign of high solvency as it would only need 0.63 years to pay back of all of its debts.
• BBY has a Debt to FCF ratio of 0.63. This is amongst the best in the industry. BBY outperforms 81.06% of its industry peers.
• BBY has a Debt/Equity ratio of 0.40. This is a healthy value indicating a solid balance between debt and equity.

Analyzing Profitability Metrics

ChartMill assigns a proprietary Profitability Rating to each stock. The score is computed by evaluating various profitability ratios and margins and ranges from 0 to 10. NYSE:BBY was assigned a score of 7 for profitability:

• BBY's Return On Assets of 8.42% is fine compared to the rest of the industry. BBY outperforms 78.03% of its industry peers.
• BBY has a Return On Equity of 45.50%. This is amongst the best in the industry. BBY outperforms 90.15% of its industry peers.
• BBY has a Return On Invested Capital of 19.99%. This is amongst the best in the industry. BBY outperforms 89.39% of its industry peers.
• Measured over the past 3 years, the Average Return On Invested Capital for BBY is significantly above the industry average of 13.73%.
• The 3 year average ROIC (27.37%) for BBY is well above the current ROIC(19.99%). The reason for the recent decline needs to be investigated.
• With a decent Profit Margin value of 2.91%, BBY is doing good in the industry, outperforming 62.12% of the companies in the same industry.
• In the last couple of years the Profit Margin of BBY has grown nicely.

Every day, new Best Dividend stocks can be found on ChartMill in our Best Dividend screener.

Check the latest full fundamental report of BBY for a complete fundamental analysis.

Keep in mind

Important Note: The content of this article is not intended as trading advice. It is essential to perform your own analysis and exercise caution when making trading decisions. The article presents observations created by automated analysis but does not guarantee any trading or investment outcomes. Always trade responsibly and make independent judgments.