Is NYSE:BBY suited for dividend investing?

BEST BUY CO INC (NYSE:BBY) was identified as a stock worth exploring by dividend investors by our stock screener. NYSE:BBY scores well on profitability, solvency and liquidity. At the same time it seems to pay a decent dividend. We'll explore this a bit deeper below.

ChartMill's Evaluation of Dividend

To gauge a stock's dividend quality, ChartMill utilizes a Dividend Rating ranging from 0 to 10. This comprehensive assessment considers various dividend aspects, including yield, history, growth, and sustainability. NYSE:BBY has achieved a 8 out of 10:

• BBY has a Yearly Dividend Yield of 4.47%, which is a nice return.
• Compared to an average industry Dividend Yield of 3.74, BBY pays a better dividend. On top of this BBY pays more dividend than 94.26% of the companies listed in the same industry.
• Compared to an average S&P500 Dividend Yield of 2.29, BBY pays a better dividend.
• On average, the dividend of BBY grows each year by 15.34%, which is quite nice.
• BBY has been paying a dividend for at least 10 years, so it has a reliable track record.
• BBY has not decreased their dividend for at least 10 years, which is a reliable track record.

Understanding NYSE:BBY's Health Score

A critical element of ChartMill's stock evaluation is the Health Rating, which spans from 0 to 10. This rating considers multiple health factors, including liquidity and solvency, both in absolute terms and relative to industry peers. NYSE:BBY has received a 6 out of 10:

• BBY has an Altman-Z score of 4.50. This indicates that BBY is financially healthy and has little risk of bankruptcy at the moment.
• Looking at the Altman-Z score, with a value of 4.50, BBY belongs to the top of the industry, outperforming 84.43% of the companies in the same industry.
• The Debt to FCF ratio of BBY is 0.95, which is an excellent value as it means it would take BBY, only 0.95 years of fcf income to pay off all of its debts.
• BBY's Debt to FCF ratio of 0.95 is amongst the best of the industry. BBY outperforms 81.15% of its industry peers.
• A Debt/Equity ratio of 0.37 indicates that BBY is not too dependend on debt financing.

Exploring NYSE:BBY's Profitability

ChartMill assigns a Profitability Rating to every stock. This score ranges from 0 to 10 and evaluates the different profitability ratios and margins, both absolutely, but also relative to the industry peers. NYSE:BBY scores a 7 out of 10:

• BBY's Return On Assets of 8.43% is fine compared to the rest of the industry. BBY outperforms 79.51% of its industry peers.
• Looking at the Return On Equity, with a value of 40.33%, BBY belongs to the top of the industry, outperforming 90.16% of the companies in the same industry.
• With an excellent Return On Invested Capital value of 19.21%, BBY belongs to the best of the industry, outperforming 87.70% of the companies in the same industry.
• The Average Return On Invested Capital over the past 3 years for BBY is significantly above the industry average of 12.81%.
• The 3 year average ROIC (25.19%) for BBY is well above the current ROIC(19.21%). The reason for the recent decline needs to be investigated.
• BBY has a better Profit Margin (2.90%) than 64.75% of its industry peers.

Our Best Dividend screener lists more Best Dividend stocks and is updated daily.

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

Keep in mind

This article should in no way be interpreted as advice. 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.