Balancing Dividends and Fundamentals: The Case of NYSE:BBY.

Last update: Nov 8, 2023

Unearth the potential of BEST BUY CO INC (NYSE:BBY) as a dividend stock recommended by our stock screening tool. NYSE:BBY maintains a robust financial footing and delivers a sustainable dividend. We'll delve into the details below.

A Closer Look at Dividend for NYSE:BBY

ChartMill provides a Dividend Rating for every stock, ranging from 0 to 10. This rating assesses various dividend aspects, including yield, growth, and sustainability. NYSE:BBY earns a 7 out of 10:

With a Yearly Dividend Yield of 5.55%, BBY is a good candidate for dividend investing.
Compared to an average industry Dividend Yield of 3.72, BBY pays a better dividend. On top of this BBY pays more dividend than 94.66% of the companies listed in the same industry.
BBY's Dividend Yield is rather good when compared to the S&P500 average which is at 2.69.
On average, the dividend of BBY grows each year by 20.80%, which is quite nice.
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.

Assessing Health for NYSE:BBY

To gauge a stock's financial health, ChartMill utilizes a Health Rating on a scale of 0 to 10. This comprehensive evaluation encompasses liquidity and solvency, both in absolute terms and in comparison to industry peers. NYSE:BBY has earned a 6 out of 10:

BBY has an Altman-Z score of 4.18. This indicates that BBY is financially healthy and has little risk of bankruptcy at the moment.
BBY's Altman-Z score of 4.18 is amongst the best of the industry. BBY outperforms 85.50% of its industry peers.
The Debt to FCF ratio of BBY is 0.63, which is an excellent value as it means it would take BBY, only 0.63 years of fcf income to pay off all of its debts.
BBY's Debt to FCF ratio of 0.63 is amongst the best of the industry. BBY outperforms 80.15% 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.

Looking at the Profitability

ChartMill employs its own Profitability Rating system for stock evaluation. This score, ranging from 0 to 10, is derived from an analysis of diverse profitability metrics and margins. In the case of NYSE:BBY, the assigned 7 is noteworthy for profitability:

BBY has a better Return On Assets (8.42%) than 77.10% of its industry peers.
With an excellent Return On Equity value of 45.50%, BBY belongs to the best of the industry, outperforming 88.55% of the companies in the same industry.
BBY has a Return On Invested Capital of 19.99%. This is amongst the best in the industry. BBY outperforms 90.08% 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 13.32%.
The last Return On Invested Capital (19.99%) for BBY is well below the 3 year average (27.37%), which needs to be investigated, but indicates that BBY had better years and this may not be a problem.
Looking at the Profit Margin, with a value of 2.91%, BBY is in the better half of the industry, outperforming 61.07% 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.

Disclaimer

This article should in no way be interpreted as advice in any way. The article is based on the observed metrics at the time of writing, but you should always make your own analysis and trade or invest at your own responsibility.